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Cleveland Fed survey shows businesses expect CPI inflation to cool to 3.3%
The survey also found expected R&D growth fell to 2.0% from 3.1% in the prior year’s reading, signaling more caution on investment.
A Cleveland Fed survey of business executives indicates inflation expectations are easing, with firms projecting consumer price inflation to run at 3.3% over the coming year, down from 3.7% reported in the second quarter, according to Forexlive.
Businesses also expect wage growth of 2.8% over the next year, only slightly below the 2.9% level recorded in the previous year’s survey, while their expectations for employment levels point to a relatively stable labor market.
The most notable shift involves research and development spending. Executives forecast R&D expenditures will grow 2.0% over the coming year, down sharply from 3.1% in last year’s survey, a change Forexlive ties to a more cautious outlook for investment amid financing costs and current conditions including Federal Reserve policy tightening bias.
Forexlive added that the Cleveland Fed’s Survey of Firms’ Inflation Expectations covers a broad quarterly panel of manufacturing and services firms and is designed to measure CEOs’ inflation expectations.