The Atlanta Fed’s Business Inflation Expectations (BIE) for April was unchanged at 1.9%, the same as the prior two months. It was also closely aligned with the year-over-year headline for the CPI in March that was released earlier in the day. If the reading for the BIE is below levels seen for the past year or so, it is quite close to the Fed’s 2% inflation objective and not showing signs of moving much lower. This would suggest that while businesses are expecting lower price increases than they saw in 2018, they are not anticipating that inflation will decline further. The concerns about trade and tariff policy and geopolitical events make it probable that prices could go higher rather than down.
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