Inflation Seen at 6% This Quarter, Above 2% in Long Term, Philadelphia Fed Survey Shows

04:12 PM EDT, 05/15/2026 (MT Newswires) -- US annual consumer inflation is expected to reach 6% in the ongoing quarter and remain above 2% in the long term, a poll of economists by the Federal Reserve Bank of Philadelphia showed Friday.

The headline consumer price index is expected to average 6% in the second quarter, according to the Fed branch's latest quarterly Survey of Professional Forecasters. That's well above the 2.7% rate pegged in the previous survey, which was published in March.

In the years through 2035, the forecasters now project headline CPI at 2.40%, up from the 2.30% rate expected previously, the Friday survey showed.

Earlier this week, official data showed that consumer inflation accelerated to 3.8% year over year in April, the highest print since May 2023. Energy prices rose nearly 18%, the highest since September 2022.

Energy prices have soared as the Strait of Hormuz remains largely shut following the US-Israel war with Iran that started at the end of February. The strait is the world's most important chokepoint for crude flows. US President Donald Trump recently rejected Iran's counteroffer to end the war, though a fragile ceasefire between the two countries appears to be holding.

Economists now expect 2026 headline CPI at 3.5%, compared with the previous forecast of 2.6%, the Philly Fed report showed Friday. Full-year core CPI -- which excludes the volatile food and energy components -- is projected at 2.9%, up from 2.6% previously.

Late last month, the central bank's Federal Open Market Committee kept its policy rate unchanged for a third consecutive meeting, saying the Middle East conflict is fueling uncertainty about the US economic outlook.

The world's largest economy is now projected to grow 2.2% this year, slower than the previous estimate of 2.5%, according to the Philly Fed's survey of 33 economists.

"The forecasters see the risk of a contraction in real (gross domestic product) this quarter at 17.9%, down from the previous estimate of 20.9%," according to the report. "However, they have increased their probability estimates for negative growth for the following three quarters, compared with their estimates in the survey of three months ago."

Economists now forecast 2026 unemployment rate at 4.4%, down from the previously projected 4.5%, the survey showed.

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