Three Stylized Facts About Inflation Expectations During the 2021-23 Inflation Surge

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Staff Reports

Three Stylized Facts About Inflation Expectations During the 2021-23 Inflation Surge

Number 1200
August 2026

JEL classification: E31, D84

Authors: Olivier Armantier, Gizem Kosar, Giorgio Topa, Wilbert van der Klaauw, and John C. Williams

We document three stylized facts about household inflation expectations that stood out during the 2021–23 inflation surge: i) a temporary dislocation in the term structure of expectations, ii) an earlier peak at longer horizons, and iii) a sharp increase in the share of households expecting deflation at medium and long horizons. We show that these stylized facts are consistent with households’ narratives attributing the inflation surge to temporary labor and supply disruptions. We also argue that they pose an empirical challenge to existing models of expectation formation. Implications for theory and expectations surveys are discussed.

Full Article

Author Disclosure Statement(s)

Olivier Armantier
The author declares that he has no relevant or material financial interests that relate to the research described in this paper.

Gizem Koşar
The author declares that she has no relevant or material financial interests that relate to the research described in this paper.

Giorgio Topa
The author declares that he has no relevant or material financial interests that relate to the research described in this paper.

Wilbert van der Klaauw
The author declares that he has no relevant or material financial interests that relate to the research described in this paper.

John C. Williams
The author declares that he has no relevant or material financial interests that relate to the research described in this paper.

Suggested Citation:
Armantier, Olivier, Gizem Koşar, Giorgio Topa, Wilbert van der Klaauw, and John C. Williams. 2026. “Three Stylized Facts About Inflation Expectations During the 2021-23 Inflation Surge.” Federal Reserve Bank of New York Staff Reports, no. 1200, August. https://doi.org/10.59576/sr.1200

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