Discussion Paper
Inflation Expectations of Fifth District Firms
Abstract: In early 2021, inflation in the U.S. began to climb, with the Consumer Price Index (CPI) peaking at 9 percent on a year-over-year basis in 2022. Since then, inflation has come down considerably. In July 2021, we started to monitor the inflation expectations of respondents to our Fifth District business surveys. We saw expectations rise along with inflation and then start to fall. In the most recent April survey, we find that most firms are following inflation. Firms' expectations for CPI growth in the next year and the next five years have increased again to levels similar to October 2023. However, in spite of reports that recent developments in trade and tariff policy have begun increasing the prices that businesses pay for inputs — some of which they expect to pass through to the prices they charge customers — firms' forecasts do not appear to correspond to their level of international exposure. In other words, firms expect increased inflation whether or not they are likely to be directly exposed to tariffs.
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https://www.richmondfed.org/region_communities/regional_data_analysis/regional_matters/2025/inflation_expectations_fifth_district
Description: Discussion Paper
Bibliographic Information
Provider: Federal Reserve Bank of Richmond
Part of Series: Regional Matters
Publication Date: 2025-04-25