The Atlanta Fed’s Business Inflation Expectations dipped negligibly in December to a median estimate of 1.9% after 2.0% in November. The reading has not varied significantly over the course of 2019. The FOMC will appreciate that inflation expectations are relatively stable and close to the Fed’s symmetric 2% objective.
Over time, it looks like business and consumer inflation expectations are lining up better and looking for more similar outcomes. Consumers are consistently estimating inflation as higher, but household incomes and spending are not the same as the needs of businesses and therefore are perceived differently.
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