Consumer inflation expectations declined slightly at the short- and longer-term horizons in October while remaining unchanged at the medium-term horizon, the Federal Reserve Bank of New York said today in its Survey of Consumer Expectations. Median inflation expectations for the one-year horizon fell from 3.7% the previous month to 3.6% in October, and from 2.8% to 2.7% for the five-year horizon. Inflation expectations for the three-year horizon were unchanged at 3%.
Median expected growth in household income increased by 0.1 percentage point to 3.1% in October, remaining above the pre-pandemic level of 2.7% in early 2020, according to the New York Fed. Median household spending growth expectations were unchanged at 5.3%.
Perceptions of credit access compared to a year ago improved slightly, with a decreased share of respondents reporting that it is more difficult to obtain credit now than a year ago, the New York Fed said. At the same time, expectations about future credit access worsened slightly, with an increased share of respondents expecting tighter credit conditions a year from now. The average perceived probability of missing a minimum debt payment over the next three months decreased by 0.5 percentage point to 12%, or roughly the same level as just before the pandemic.