Question: Can you help me with this? use the FRED website The expected real interest rate is the rate which people use in making decisions about

Can you help me with this? use the FRED website

The expected real interest rate is the rate which people use in making decisions about the future. It is approximately the difference between the nominal interest rate and the t expected inflation rate (Fisher Equation), not the actual inflation rate.

How does expected inflation over the coming year compare with actual inflation over the past year? Plot the inflation rate since 1978 based on the percent change from a year ago of the U.S consumer price index (FRED code: CPIAUCSL). Add to this figure as a second line the expected inflation rate from the University of Michigan survey of consumers (FRED code: MICH).

Is expected inflation always in line with actual inflation? Which is more stable?

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