In June 2016, we looked at Americans' perception of inflation and found those perceptions to be considerably higher than the official numbers. In a new Zogby Analytics national online survey of 1,004 American adults*, we revisited these questions. We have found that subjective perception of how much prices have increased or decreased remains higher than the official statistics; however, the gap between the two has narrowed.
Median overall perceived inflation over the past year is 5% - a half of what it was in June 2016. Democrats perceive inflation as significantly higher than Republicans and women continue to perceive inflation to be higher than do men.
Unlike two years ago, median perceived inflation varies significantly by party: the median Democrat perceives prices to have increased by 10%, while the median Republican perceives the increase to be 3%. President's Trump approval plays a similar role: those who strongly approve of the job the president is doing perceive inflation to be 3%; those who merely approve perceive it to be 5%, and those who disapprove or strongly disapprove perceive it to be 10%. Women continue to perceive inflation as higher (median: 10%) than men (median: 5%).
Among categories tested, median perceived inflation was highest for healthcare (10%) and college education (10%), and lowest for childcare (5%). Overall, differences were fairly small.
Similarly to 2016, we have asked our respondents to separately estimate the change in prices for the following categories: food and beverages, housing, healthcare, college education and childcare. The highest median perceived inflation was for healthcare, housing and college education ( all 10%) and the lowest for childcare and food and beverages (both 5%). Male perception of inflation varies significantly by category starting from the relatively low 5% for food/beverages to 10% in healthcare while female respondents have the same 10% median in all areas except childcare (6%).
On a scale 1-10 where 1 stands for 'not at all afraid' and 10 for 'terrified', average fear of inflation is 5. Democrats, women, and those with lower household incomes are most worried about inflation.
American adults are moderately afraid of inflation: On a scale 1-10 where 1 stands for 'not at all afraid' and 10 for 'terrified', average fear of inflation is 5.63 and '5' is the most common value. On average, women (6.27) tend to be more concerned than men (5.03), Democrats (6.32) are more worried than Republicans (5.00) and respondents with household incomes that are less than $50k are more worried (6.08) than those with incomes in the $50k-$100k range (5.59) or more than $100k (5.01).
The Chinese yuan is perceived as the biggest long-term threat to the US dollar. This is largely a generational thing - older adults are four times more likely than younger adults to perceive the Chinese yuan as the biggest threat.
When offered a list of currencies to indicate the biggest long-term threat to the US dollar, 22% of respondents chose the Chinese yuan, followed by 10% who chose the Euro and 'none', and 9% who chose crypto-currencies; 38% of respondents chose the option 'don't know'. The older the respondents are, the more likely they are to see the yuan as a threat to the US dollar: 34% of adults over 65 years of age see the yuan as the biggest threat compared to 6% of adults aged 18-29. Partisan differences come into play, too, as 18% of Democrats see the Chinese yuan as the biggest threat compared to 27% of Republicans and the same number of Independents.
The poll of 1004 US adults was conducted online between 10/15/2018 through 10/17/18 and has a margin of error of +/- 3.1 percentage points.
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