The Economy & the Fed

Inflation Expectations

What people expect prices to do. The University of Michigan asks households how much they expect prices to rise over the next year and over the next five to ten years. Expectations matter because they can become real: workers who expect higher prices ask for higher pay, and businesses raise prices to cover it. The Federal Reserve wants long-run expectations anchored near its 2% goal and watches this survey and market measures, such as the gap between regular Treasuries and TIPS.

Educational information, not investment advice. See it applied across the screener →