Don’t Fret Unduly on Inflation Expectations, Top Behavioral Economist Says

Concern that soaring inflation will become self-fulfilling may give too much weight to financial-market pricing and not enough to the relatively muted views of households, according to Nobel laureate economist Richard Thaler.

While consumers are certainly feeling the effects of high prices, there’s little evidence that they anticipate further sharp gains, or are acting to compensate for such a scenario in wage negotiations, he said in an interview in Lindau, Germany.