The latest consumer survey from the Federal Reserve Bank of New York indicates that inflation expectations among households remained contained in August, even as gasoline prices moved higher. However, concerns about the labor market have started to intensify among respondents.
Participants in the survey anticipate that inflation one year from now will register at 3.6%, with the five-year inflation outlook holding steady at 3%. Both of these figures match the results recorded in the July survey. Meanwhile, the three-year inflation expectation ticked up to 3.2%, reflecting a 0.1 percentage point increase compared with the previous month.
At the same time, the labor market is sending out conflicting signals to consumers. The share of respondents who expect the unemployment rate to rise over the next twelve months climbed to 44.4%, a 1.6 percentage point jump month over month, marking the highest level since April 2020. On the other hand, the average probability that respondents assign to losing their own job in the coming year eased back to 13.8%, which is the lowest reading since February.
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