New York Fed: Inflation expectations mostly unchanged in November

Consumer inflation expectations in November declined at the short-term horizon but remained unchanged at the medium and longer-term horizons, according to the Federal Reserve Bank of New York’s monthly Survey of Consumer Expectations released today. Median one-year-ahead inflation expectations declined by 0.2 percentage points in November to 3.4%, the lowest reading since April 2021. Median inflation expectations at the three- and five-year-ahead horizons remained unchanged at 3.0% and 2.7%, respectively.

Median expected growth in household income was unchanged at 3.1% in November, remaining above the survey’s pre-pandemic level of 2.7% in February 2020, according to the New York Fed. Median household spending growth expectations declined by 0.1 percentage points to 5.2%.

Perceptions of credit access improved with fewer respondents reporting that it is harder to obtain credit today compared to a year ago, according to the survey. Similarly, consumers were more optimistic about future credit access with fewer 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 0.2 percentage points to 11.8%, a level comparable to those prevailing just before the pandemic.