Consumer inflation expectations declined in the short, medium and longer terms in November, according to the Federal Reserve Bank of New York’s monthly Survey of Consumer Expectations released today. Household income growth expectations increased while expectations about credit access one year from now worsened.
Median inflation expectations decreased at both the one- and three-year-ahead horizons in November by 0.7 percentage points to 5.2% and by 0.1 percentage points, to 3%, respectively. Both decreases were broad-based across education and income groups. Median five-year-ahead inflation expectations also decreased by 0.1 percentage points to 2.3%. The median expected growth in household income increased by 0.2 percentage points to 4.5% in November, a new series high. However, median household spending growth expectations decreased slightly to 6.9% from 7% in October.
Perceptions of credit access compared to a year ago deteriorated in November, with the share of households reporting it is harder to obtain credit than one year ago. Expectations for future credit availability were unchanged. The average perceived probability of missing a minimum debt payment over the next three months increased to 11.8% from 11.6% in October, remaining comparable to rates that prevailed leading up to the pandemic.
