US firms’ inflation expectations are surging: Services and manufacturing companies anticipate their costs will increase by 5.7% and 7.3% in 2025, according to the NY Fed. That would mark the largest jump for manufacturing firms in at least 3 years and the largest jump for services firms in 2 years. Furthermore, expected cost increases are higher among companies that import more from abroad. Services firms expect their selling prices will rise by ~5.0% in 2025, the most since 2023. At the same time, manufacturing firms anticipate selling prices to increase 5.4%, the most since 2022. Inflation is set to remain elevated.