Falling gas prices are raising hopes that inflation is slowing, a New York Fed survey shows.
Lower gas prices are raising optimism that inflation is on the decline, according to a survey Monday from the New York Federal Reserve.
Respondents to the central bank’s August Survey of Consumer Expectations indicated they expect the annual inflation rate to be 5.7% a year from now. That’s a decline from 6.2% in July and the lowest level since October 2021.
Three-year inflation expectations dropped to 2.8% in August from 3.2% the previous month. That was tied for the lowest level for that measure since November 2020.
The lowered outlook came amid a tumble in gasoline prices from more than $5 a gallon earlier in the summer, a nominal record high. The current national average is about $3.71 a gallon, still well above the price from a year ago, but about a 26-cent decline from the same point in August, according to AAA.