US consumers' medium-term inflation expectations fall to lowest level in 11 years

A survey by the US New York Fed showed that US consumers' expectations for medium-term inflation fell to the lowest level since at least 2013.Expected inflation over the next three years fell to 2.35 per cent in January, the lowest level since the data was recorded nearly 11 years ago. Median inflation expectations for the next one and five years were 3 per cent and 2.5 per cent, respectively, unchanged from the previous month. The data will help reassure Fed officials, who have previously said they are seeking greater confidence that inflation will remain near their 2 per cent target before they start cutting rates. Americans' inflation expectations for frequently purchased goods (food and petrol) both eased in the January survey. The expected change in gasoline prices over the next year fell to 4.2 per cent, the lowest level since December 2022, while the expected change in food prices fell to 4.9 per cent, the lowest level since March 2020.