FX.co ★ US 1-Year Inflation Expectations Confirmed at 4.2%

Year-ahead inflation expectations in the United States, as measured by the University of Michigan survey, declined for a second straight month, reaching 4.2% in July 2026. This was the lowest level since March, down from 4.6% in June and consistent with the preliminary estimate. However, expectations remained significantly above the 3.4% recorded in February, before the onset of the Iran conflict, and above all readings observed throughout 2024. At the same time, the five-year inflation outlook held at 3.3% in July, unchanged from June and in line with the preliminary figure, yet still slightly above the 2.8%–3.2% range that prevailed during 2024.