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New York Fed anticipates inflation to decline to 5.7% in a year, gas prices continue to drop

Yahoo Finance Live's Dave Briggs reports on the Fed's inflation forecast a year from now while also looking at gas prices.

Video Transcript

[AUDIO LOGO]

DAVE BRIGGS: A lot of green on the board. Thank you, Seana. Let's get you up to speed now on inflation. Gas prices fueling optimism that inflation is declining. A new survey released earlier today from the New York Fed showed consumers expect the annual inflation rate to be 5.7% one year from now. That's a decline from 6.2% in July and the lowest level since October 2021.

Now, three-year inflation expectations dropped to 2.8% of the lowest level since November 2020. Again, this all due largely to declining gas prices, which now stand at $3.71 a gallon nationally, and that's according to AAA. Down $0.26 per gallon over the past month. The lowered outlook came amid a tumble in gasoline prices for more than $5.00 a gallon earlier in the summer, a nominal record high.

The current national average, again, $3.71. But about 26% decline from the same point in August. That, again, according to AAA. All of course, Seana, hinging on the CPI, which we will wait tomorrow, which could change everything as we now know it.