Americans’ Pessimism On Inflation Hits Record High

By Casey Harper (The Center Square)

The majority of Americans think the rise in inflation last year will only get worse in 2022, according to a new poll.

Gallup released polling data Wednesday showing that 79% of surveyed Americans “predict inflation will go up,” with 50% saying it will go up “a lot.” Those are the most pessimistic numbers on inflation ever recorded by Gallup, the pollster said.

Americans are split on economic growth, though, with 40% saying it will increase and 39% saying it will decrease.

“In the past, Americans have always been more likely to say inflation will increase rather than decrease, but the current expectation is higher than usual – in fact, it is the highest Gallup has measured in its trend,” Gallup said. “The prior high was 76% in September 2005. In recent years, from 2007 through 2020, roughly six in 10 Americans have expected inflation to increase.”

The poll comes after months of economic data showing skyrocketing prices last year.

The Department of Labor’s Bureau of Labor Statistics released new inflation data for December that showed the price of goods and services rose at the fastest rate since 1982.

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“The all items index rose 7.0 percent for the 12 months ending December, the largest 12-month increase since the period ending June 1982,” BLS said. “The all items less food and energy index rose 5.5 percent, the largest 12-month change since the period ending February 1991. The energy index rose 29.3 percent over the last year, and the food index increased 6.3 percent.”

At the same time, the consumer price index data released this month reported the fastest increase in decades.

“This was the sixth time in the last 9 months it has increased at least 0.5 percent,” BLS said. “Along with the indexes for shelter and for used cars and trucks, the indexes for household furnishings and operations, apparel, new vehicles, and medical care all increased in December. As in November, the indexes for motor vehicle insurance and recreation were among the few to decline over the month.”

Gallup found that Americans do believe, though, that unemployment and the stock market will improve.

“At the same time, Americans are more likely to predict the stock market will go up (46%) than go down (29%), and more also expect unemployment to go down (43%) than go up (34%),” Gallup said. “The Jan. 3-16 poll was finished before major stock indices fell the week of Jan. 17.”

Syndicated with permission from The Center Square.