Firms’ Long-Term Inflation Expectations And Effect Of Supply Disruptions

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the June 2022 BIE Survey dated June 15, 2022 (involving 185 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations remain relatively unchanged at 3.7 percent, on average.
  • Current economic environment: “Compared to normal,” although sales levels decreased, profit margins remained relatively unchanged. Year-over-year unit cost growth slightly increased at 4.3 percent, on average.
  • Quarterly question: Firm’s long-run inflation expectations significantly increased at 3.5 percent, on average, and 87 percent of firms are expecting their unit costs to increase in the long run. Both the long-term inflation expectation (3.5 percent) and the percent of firms that expect unit costs to increase very significantly (31 percent) are at an all-time high.
  • Special question: Firms were asked whether or not they experienced supply chain disruptions or delays. They were also asked, for those who experienced supply chain disruptions or delays, how they affected the firms and how they would describe the current supply chain disruptions or delays. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

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ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

Firms’ Inflation Expectations And Inflation’s Influence On Prices

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the May 2022 BIE Survey dated May 11, 2022 (involving 199 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations remain relatively unchanged at 3.7 percent, on average.
  • Current economic environment: Sales levels and profit margins “compared to normal” remain relatively unchanged. Year-over-year unit cost growth is unchanged at 4.2 percent, on average.
  • Quarterly question: Approximately 50 percent of firms expect both labor costs and nonlabor costs to put significant upward influence on prices. About 30 percent of firms expect sales levels and margin adjustments to put moderate upward influence on prices during the next 12 months.
  • Special question: Firms were asked how influential aggregate inflation is when making business decisions. They were then asked to forecast the expected CPI inflation rate over the next 12 months. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

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RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

Firms’ Year-Ahead Inflation Expectations And Demand Characteristics

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the April 2022 BIE Survey dated April 13, 2022 (involving 207 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations remain unchanged at 3.8 percent, on average.
  • Current economic environment: Sales levels and profit margins “compared to normal” remain relatively unchanged. Year-over-year unit cost growth increased slightly to 4.2 percent, on average.
  • Quarterly question: Firms’ sales gap (percentage below “normal” unit sales levels) increased significantly to 1.3 percent above normal and remain at historically high levels.
  • Special question: Firms were asked how their levels of demand changed over the prior 12 months. They were then asked to note the actions taken in response to the change in demand. Finally, they provided information on whether they expect these changes to persist over the next 12 months. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

_____

RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

Firms’ Short- And Medium-Term Inflation Expectations

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the March 2022 BIE Survey dated March 16, 2022 (involving 183 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations increased significantly to 3.8 percent, on average.
  • Current economic environment: Both sales levels and profit margins “compared to normal” decreased over the month. Year-over-year unit cost growth is relatively unchanged at 4.1 percent, on average.
  • Quarterly question: Firms’ long-term (per year, over the next five to 10 years) inflation expectations increased to 3.3 percent, on average.
  • Special question: Firms were asked about their ability to pass cost increases through to their prices. They were then asked how the price of their primary good or service has changed over the last 12 months. Finally, they provided the expected rate of growth in their primary price over the next 12 months and the next five to 10 years. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

_____

RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.

Firms’ Inflation Expectations And Business Disruptions

The Federal Reserve Bank of Atlanta publishes a monthly report titled “Business Inflation Expectations” (BIE) that contains statistics from a survey of regional businesses’ views on various factors that impact profitability.  These factors include unit costs, unit cost expectations, sales levels, pricing, profit margins, and other factors.

As described on the site:

“Approximately 300 panelists receive the survey each month. Panelists represent businesses of various sizes headquartered within the Sixth District, which encompasses Alabama, Florida, Georgia, and sections of Louisiana, Mississippi, and Tennessee. Panelists range from executives of large corporations to owner-operators of small businesses. The industry composition of the panel roughly reflects the makeup of the national economy. Nevertheless, survey responses are weighted by industry shares of national gross domestic product.”

An excerpt from the February 2022 BIE Survey dated February 16, 2022 (involving 175 firms responding):

  • Inflation expectations: Firms’ year-ahead inflation expectations increased significantly to 3.6 percent, on average.
  • Current economic environment: Sales levels “compared to normal” remain unchanged. Profit margins decreased, though they remain at historically normal levels. Year-over-year unit cost growth increased significantly to 4.0 percent, on average.
  • Quarterly question: Approximately 40 percent of firms expect both labor costs and nonlabor costs to put significant upward influence on prices. About 30 percent of firms expect sales levels and margin adjustments to put moderate upward influence on prices over the next 12 months.
  • Special question: Firms were asked about the business operation disruptions they’ve experienced, if any. They were then asked to rate the severity of their experienced disruptions and estimate how long they will persist. A breakdown of the results can be found in the special question section below.

The report also includes other questions and a variety of charts and tables depicting respondents’ answers.

_____

RevSD, LLC offers the above commentary for informational purposes only, and does not necessarily agree with all (or any) of the views expressed by these outside parties.

—–

ProfitabilityIssues.com is published by RevSD, LLC.  RevSD, LLC is a management consulting firm and strategic advisory that focuses on the analysis of current and future business conditions, and given these conditions, offers corporations and businesses advice, strategies, and actionable methods on how to optimally increase revenues and profitability.