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NY Fed Sees Bounce In 3Y Inflation Expectations

US
  • NY Fed inflation expectations for 1Y ahead fall 0.3pts to 5.44%, the lowest since Sep’21 but still higher than 4.7% in the U.Mich equivalent.
  • The 3Y ahead measure meanwhile increased from 2.76% to 2.91% but it follows a particularly swift decline having been 3.88% in May, bringing it closer to the U.Mich 5-10Y measure of 2.7%, further supporting the decline in long-term market-based inflation expectations.
  • However, with realized inflation still particularly strong and short-term expectations remaining elevated despite cooling, it keeps pressure on the Fed to continue its aggressive tightening.

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