The declining prices of oil as well as a stronger US dollar failed to dampen the inflation expectations of the United States in the month of November, a survey conducted by the Federal Reserve Bank of New York showed.
The survey, which was released on Monday, also found a significant jump in expected earnings growth in the country and the forecasts also pointing toward borrowing costs increasing ever so gradually.
The country’s economy is expected to pick up in 2015 with dropping unemployment rate, while inflation seen slowing slightly, according to the survey.
The survey forecasts were based on the feedback collected from analysts, manufacturers, bankers and several other industry experts who participated in the annual outlook symposium of regional Fed bank last week.
The yield on the one-year Treasury bill is seen increasing to 0.47 percent by next year’s fourth quarter, from 0.11 percent this quarter.
The America’s central bank has kept the interest rates near zero for six years now. But the improving conditions of the country’s labor market and stronger sentiments of prospering economy have bolstered the expectations for the Fed to commence raising key rates sometime next year. The experts say the survey results are in cognizance with that view.
Sources said that the fed officials are keenly observing the inflation and its effect in the market and it is expected to rise slowly back toward its two percent goal in the coming years.
The country’s economy was witnessed growing 2.7 percent, faster than the historical average of the nation.