Consumer Inflation Expectations... Falling?! [Eurodollar University, Ep. 189]

Feb 20, 2022

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Consumer inflation expectations peaked in October/November 2021, according to the Federal Reserve Bank of New York's Survey of Consumer Expectations. Market based inflation expectations (Treasury Inflation Protected Securities) also peaked then. What in the CPI is going on here?

------EP. 189 TOPICS------
00:00 INTRO: The Federal Reserve intends to raise short term interest rates because...???
00:53 The Federal Reserve is not a central bank (it doesn't do money supply / demand).
03:07 The Fed will hike rates because of tight labor market is tight...
04:52 Can we trust a low unemployment rate?
06:12 How many workers short is the USA of recovery?
08:57 The Fed was (very) recently fooled by a (very) low unemployment rate.
11:07 The Fed will hike rates because of (rising?) inflation expectations...
15:47 The FRBNY asks consumers what their expectations are for inflation.
19:00 Market-based inflation expectations peaked in Oct/Nov 2020, like consumer expectations.
21:42 A review of FRBNY survey details of consumer inflation expectations for 3 years ahead.
24:30 High CPI is unlikely to persist because: logistic resolution and economic weakness.
25:21 A review of FRBNY survey details of consumer inflation expectations for 1 years ahead.

----EP. 189 REFERENCES----
Federal Reserve’s Own Inflation Expectations Surveys More Agree w/Euro$ Futures Inversion Than Rate Hikes: https://bit.ly/3GYESmb
Survey of Consumer Expectations: https://nyfed.org/3GYrIWg
Why Do We Think That Inflation Expectations Matter for Inflation? (And Should We?): https://bit.ly/3gRFyiI
Alhambra Investments Blog: https://bit.ly/2VIC2wWlin
RealClear Markets Essays: https://bit.ly/38tL5a7

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---------THE TEAM---------
Jeff Snider, Head of Global Investment Research for Alhambra Investments. Master of ceremonies, Emil Kalinowski. Illustrations by David Parkins. Audio and video editor, Terence. Episode intro/outro music is "When To Stop" by Lofive from Epidemic Sound.

------FIND THE TEAM-------
Jeff: https://twitter.com/JeffSnider_AIP
Jeff: https://alhambrapartners.com/author/jsnider/

Emil: https://twitter.com/EmilKalinowski
Emil: https://www.EuroDollarEnterprises.com

David: https://DavidParkins.com/
Terence: https://www.VisualFocusMedia.com