US annual consumer inflation forecast falls to 18-month low

U.S. consumers expect price pressures to ease significantly next year. However, Friday's benchmark study showed that the U.S. annual inflation forecast fell to its lowest level in a year and a half in December.

According to a study by the University of Michigan, the annual inflation forecast released with the bi-monthly reading of overall consumer sentiment this month fell from 4.9% to 4.4%. Released inflation outlook also declined from the preliminary reading of 4.6% two weeks ago.

This figure is the lowest since June 2022. Short-term inflation expectations fell by half a percentage point compared to November. Despite the fact that it was the largest since September 2020.

The outlook for the next five years decreased slightly from 3.0% to 2.9% in November and early December.