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U.S. consumers continued to trim their near-term inflation expectations in November, the Federal Reserve Bank of New York said Monday.
The median expectation for one-year ahead inflation edged down to 3.4% in November from 3.6% in October, according to the New York Fed’s Survey of Consumer Expectations survey. That’s the lowest reading since April 2021.
Meantime, implied inflation at longer-term horizons held steady. The median three-and five-year ahead inflation expectations were unchanged at 3.0% and 2.7%, respectively.
On the labor market, consumers expect to earn slightly less over the near-term. The median one-year ahead expected earnings growth ticked down to 2.7% from 2.8%, moving out of the 2.8%-3.0% range in which it has been confined since September 2021.
Consumers’ uncertainty about their current job security was on the rise. The mean perceived probability of losing one’s job in the next twelve months advanced to 13.6% from 12.7%. The mean perceived probability of finding a job also fell to 55.2% from 56.6%.
Income expectations at the household level was unchanged at 3.1% in November, staying above the series’ February 2020 prepandemic level of 2.7%, the survey showed. Meanwhile, median household spending growth expectations fell to 5.2% from 5.3%, remaining well above the February 2020 level of 3.1%.
Perceptions of credit access compared to a year ago improved for the second straight month with a smaller share of respondents reporting that it’s harder to obtain credit today vs. a year before.
The average perceived probability of missing a minimum debt payment over the next three months fell to 11.8% from 12.0%, a level comparable to those just before the pandemic.
