According to a study released by the New York Federal Reserve in December, Americans' predictions for inflation one year from now remained at a record high for the second month in a row, with families predicting a historic increase in incomes.
According to the Jan. 10 poll, consumers' forecasts for inflation over the next year remained stable in December at 6%, matching November's record-high number.
The three-year inflation forecast stayed constant from November, at 4%, down slightly from the record high of 4.2 percent in October.
The predicted rise in family income one year ahead jumped to 3.4 percent in December, according to the New York Fed's consumer expectations survey, which is based on a rotating panel of 1,300 participants. That, too, is a new high, which some economists are likely to interpret as a hint of an upward wage-price spiral similar to the one that plagued the US economy in the 1970s.
“Wage/Price spiral is real…and it is alive,” Kenny Polcari, managing partner at Kace Capital Advisors, said in a tweet. “Have been saying it for months now and now it is here,” he added.
11 Jan 2022