§ analysis/CLIP/NY-FED-SURVEY-INFLATION-EXPECTATIONS-RE-ANCHOR
As Inflation Worries Cool, the Fed's Battle Shifts to Services and Shelter
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May 20, 2026
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Inflation expectations have re-anchored at 2.4% per the New York Fed survey, the lowest reading since the post-pandemic spike. Goods inflation is firmly back below pre-COVID norms; the stickiness is now isolated in shelter and services.
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The New York Fed survey offers good news, with inflation expectations falling to 2.4%, the lowest since the pandemic spike. This suggests the Fed's messaging is working. The fight isn't over, however, as stubborn inflation in shelter and services shows the problem has shifted, not disappeared.
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· 4 sources⊘ CONTRADICTSnewyorkfed.org
Survey of Consumer Expectations - Federal Reserve Bank of New York
Median one-year-ahead inflation expectations remained unchanged at 3.3% in May. Median three-year-ahead inflation expectations decreased to 2.8% from 3.0% in April, while median five-year-ahead inflation expectations increased to 3.0% from 2.8%.
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✓ SUPPORTSapnews.com
US inflation has cooled. Here’s where prices are still high.
A key factor in the past year’s falling inflation has been a drop in the price of goods... By contrast, the prices of services — things like airline fares, haircuts and car insurance — are still climbing... The biggest driver of services inflation continues to be housing. The government’s shelter index rose 0.4% from April to May and 5.4% from a year earlier.
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✓ SUPPORTSbloomberg.com
US CPI Report Shows Inflation Cooled More Than Forecast in May
Shelter prices, which are the biggest component of services, rose 0.4% for a fourth straight month. So-called core goods prices, which exclude food and energy commodities, fell 0.4%, the most since early 2003.
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· CONTEXTforbes.com
Inflation Expectations Are Coming Down, But Will The Fed Listen?
The three-year inflation expectation declined from 3% to 2.4% in September, a low not seen since early 2021.
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