Millennials May Put A Damper On The Fed’s Goal To See Higher Inflation Rates

Millennials Shopping

One of the requirements the Federal Reserve has mandated before raising interest rates is that inflation rise to at least 2%—but central bankers may have a demographic hurdle to overcome: Millennials' inflation expectations.

The 19- to 35-year-olds aren’t expecting prices to rise any time soon, according to Personal Consumption Expenditure stats. Americans who started working in 2000 and onward are used to a mundane inflation climate, with PCE price inflation averaging about 1.7%, Bloomberg reports.

The PCE rate hasn’t exceeded 2.5% since the start of the millennium—compare that to the average 4.3% inflation rates that the majority of Baby Boomers experienced in their prime working years and it's apparent why Millennials continue to report lower inflation rate expectations. To succeed in its plan to raise inflation expectations for the generation, economists are encouraging the Fed to target forces that drive deflation for Millennials—technology and subsidized education and healthcare. [Bloomberg]

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's National Newsletters
Related Stories

Bank OZK Shares Drop After Citi Flags $915M Mortgage Concern

Soaring Yields Strand REITs In M&A No-Man’s-Land

How UK Investment Giant L&G Plans To Grow Its U.S. Multifamily Holdings

Properties Owned By REIT Accused Of Fraud To Be Auctioned Off

LS Power Raises $6B To Capitalize On Data Center Power Demand

DHS Buys 3 More Detention Facilities From The Geo Group For $950M

CRE Finance Sentiment Index Falls To 3-Year Low As Economic Fears Mount

Oprah-Backed Health Food Chain Files For Bankruptcy, Seeks To Exit Leases

Fund Affiliated With Michael Dell Takes $1B Swing At Senior Housing

Multifamily's Days As Commercial Real Estate's 'Golden Child' Are Over

Denver Construction Costs On The Rise, Surpass National Increases

Real Estate Fundraising Shrinks, Targets Get Smaller