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Inflation expectations are important to monetary policy makers. The period of high inflation following the pandemic provides a useful context for exploring how inflation expectations influence business and consumer behaviors. Using survey data, we examine how businesses and consumers respond to their inflation expectations. We find that firms’ pricing and wage setting behaviors were positively correlated with high inflation expectations during the period. These behaviors could reinforce inflation. Consumer spending and labor market decisions tend to show an increase in labor supply and a reduction in consumption in response to high inflation expectations, which could moderate rather than strengthen future inflation.