Business expectations for inflation rose to a new high in March, a survey by the Federal Reserve Bank of Atlanta showed Wednesday.
The year-ahead expectation for inflation rose significantly to 3.8 percent, on average, the Atlanta Fed said. That is the highest expected inflation in data going back to 2011.
Businesses said they expect inflation to run at 3.3 percent over the next five to 10 years. The Federal Reserve believes inflation will run at around two percent once it tames the current multi-decade high rise in price levels.
Twenty-four percent of businesses surveyed said they have a greater ability to pass through cost increases to customers than they did 12 months ago. Another six percent said they have significantly great ability. Thirty-eight percent said there was no change in pricing power. Twenty-five percent said their ability to pass on costs diminished and eight percent said it had significantly diminished.