NY Fed Survey: Inflation Expectations Calm Before Iran War

Americans' inflation outlook steady in February, but oil price surge could change that

Published on Mar. 9, 2026

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A Federal Reserve Bank of New York survey found Americans' inflation expectations were little changed in February, with the expected level of inflation a year from now ebbing to 3% from 3.1% in January. However, the survey was conducted before the recent surge in oil prices due to President Trump's war on Iran, which is likely to drive up overall inflation and could push the public toward a less benign view on the inflation outlook.

Why it matters

The survey results provide a snapshot of consumer sentiment on inflation before the oil price shock, which could complicate the Federal Reserve's efforts to bring inflation back to its 2% target. Where price pressures are expected to go exerts a strong influence on where they stand now, so if the oil shock creates expectations of higher inflation, that could make the Fed's job more difficult.

The details

The New York Fed survey found relative calm on the hiring front in February, with respondents projecting a lower future unemployment rate and a lower prospect of losing a job compared to January. However, they said finding new work would be harder. Respondents also said credit was harder to get in February versus January, but would be easier to get in the future. They were more upbeat about current finances in February versus the prior month, while holding steady views about the future state of their finances.

  • The survey was conducted between February 2-28, 2026.
  • The University of Michigan will release its latest consumer sentiment report on Friday, which may offer a more up-to-date view on how the public is pricing the energy surge into its inflation outlook.

The players

Federal Reserve Bank of New York

The regional Federal Reserve bank that conducts the Survey of Consumer Expectations.

President Donald Trump

The U.S. president who initiated a war on Iran, leading to a surge in oil prices.

Deutsche Bank

An investment bank that commented on the potential impact of the oil price surge on inflation.

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What’s next

The University of Michigan's latest consumer sentiment report on Friday may provide more insight into how the public is reacting to the surge in oil prices and its impact on inflation expectations.

The takeaway

This survey provides a glimpse into consumer sentiment on inflation before the recent oil price shock, which could significantly alter the public's inflation outlook and complicate the Federal Reserve's efforts to bring inflation back to its 2% target. The upcoming University of Michigan report will be closely watched for a more up-to-date view on this evolving situation.