Companies See Inflation Inching Up to 2.1%, Atlanta Fed Says

Inflation Expectations - Firms' year-ahead inflation expectations increased by 0.2 percentage points to 2.1% in March, up from 1.9% in February but down from 2.5% in March 2025 [1][2] - Long-run unit cost expectations increased by 0.1 percentage points to 2.8%, compared to the last survey in December 2025 [3] Cost and Profit Margins - Year-ahead unit cost expectations have decreased from a peak of 3.8% in April 2022 but remain elevated compared to the pre-pandemic average of 2.0% [3] - Sales levels and profit margins "compared to normal" have decreased, while year-over-year unit cost growth remained constant at 2.0% [4] Consumer Inflation Expectations - The Cleveland Fed reported that business leaders expect inflation to be 3.1% over the next 12 months, down from 3.3% in October 2025 [8] - Consumers' median inflation expectations declined by 0.1 percentage point to 3.0% at the one-year horizon, remaining steady at 3.0% for three and five-year horizons [11]