The U.S. inflation rate is the lowest in three and a half years, but six of 10 consumers say inflation affects them more now than it did three months ago, and more than one-third of them expect inflation will be worse in November than it is now, according to a University of Illinois survey. Republicans held the gloomiest views.
“While we observe some differences in views on inflation by political affiliation, the impacts of inflation and high prices are being felt by consumers across the political spectrum,” said the survey’s analysts on the farmdoc daily blog. The survey of approximately 1,000 consumers, designed to be nationally representative, was conducted in August.
Inflation and high prices are a leading issue in the presidential election. Vice President Kamala Harris says she would seek the first federal ban on price gouging on food and groceries. Former president Donald Trump says he would bring down prices by increasing U.S. energy production, cutting federal spending and regulations, and deporting undocumented immigrants.
In the August survey, 59.7 percent of respondents said inflation affected them more than it did in May, 34.6 said the effect was unchanged, and 5.6 percent said the impact was less. When asked to look ahead by three months, to November, 36 percent said they expected inflation to be worse, 36.7 percent said it would be the same, and 27.3 percent said it would lessen.
Some 43 percent of Republicans said inflation would be worse in November while 35.1 percent of Democrats said inflation would be lower. Among independents, 38.9 percent said inflation would get worse and 24.5 percent said it would be better.
“Results from the most recent wave of the Gardner Food and Agricultural Policy Survey show that the average U.S. consumer is still feeling the effects of inflation,” said analysts Maria Kalaitzandonakes and Jonathan Coppess of the University of Illinois and Brenna Ellison of Purdue University. “While the rate of inflation is slowing down, this does not mean prices experienced by households will be lower or that their perceptions of inflation are improving. Our results indicate that over the last two years, consumers remain quite pessimistic about inflation.”
At present, the U.S. inflation rate is 2.5 percent and the food inflation rate is 2.1 percent over the past 12 months.
Consumers surveyed by Purdue have overestimated the food inflation rate every month since mid-2023. In the latest survey, they said it was 5.4 percent. Survey participants said they expected food prices would rise 2.8 percent over the next 12 months; the USDA forecast is 2 percent for 2025. But respondents have reduced their expected food inflation rate by 0.8 points in two months.
“The drop in food inflation expectations in recent months may be indicative of consumers adjusting to the more stable food inflation rate we have observed over the last seven months,” said Purdue’s Center for Food Demand Analysis and Sustainability.