MNI BRIEF: Fed Inflation Expectations Index Highest Since 2008

The Federal Reserve Board's Index of Common Inflation Expectations, an internal gauge of longer run inflation expectations constructed from two dozen other indicators, edged up to 2.15% in the first quarter, the highest since September 2008.

The CIE Index, which now includes data from the New York Fed's Survey of Consumer Expectations and the University of Michigan Survey of Consumers, rose 0.02pp in the prior quarter. The series goes back to 1999, and notched its highest reading at 2.19% in June 2008. The index combines market and survey measures into a single view of how households and businesses expect prices to behave over the next decade.

An alternative CIE index, projected onto Michigan's survey of consumers over the next 5-10 years, was also a high going back to 2008, up 0.07pp to 3.05% from the last quarter. Earlier this week the New York Fed reported its median three-year-ahead consumer expectations rose to 3.7% and the year-ahead measure jumped to 6.6%, a high for the series that goes back to 2013.