Households Median Inflation Perception And Expectations Increase Sharply In May 2020

The Reserve Bank released the results of the May 2020 round of the Inflation Expectations Survey of Households (IESH). The Households' median inflation perception and expectations increased sharply in May 2020 as compared with the March 2020 round of the survey. Inflation expectation over three-month horizon exceeded that for the next year ahead period in quantitative terms. Three months and one year ahead median inflation expectations rose by 190 and 120 basis points, respectively, over the previous round. Expecting increasing price pressure on food products, more households expect general prices and inflation to rise over three months horizon as compared to previous round. However, the prices of all product groups, especially cost of housing, are expected to ease over a year ahead period.

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