Firms’ Inflation Expectations And Levels Of Optimism

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, 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 October 2018 BIE Survey dated October 10, 2018 (involving 173 firms responding):

• Inflation expectations: Firms’ inflation expectations increased somewhat to 2.3 percent over the year ahead.

also:

• Quarterly question: Long-term inflation expectations (per year, over the next five to 10 years) increased to 2.9 percent, on average.
• Special question: Firms provided a rating (from 0 to 100, with 100 being most optimistic) of their level of optimism for both their own firm’s financial prospects as well as the U.S. economy overall. Both optimism measures had a median value of 80. Please see the special question section for a comparison of this month’s values with prior months’ values.

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