A new Federal Reserve survey suggests that American consumers are regaining confidence in their financial outlooks as inflation concerns ease. The survey’s short-term inflation expectations, which indicate what consumers expect prices to do over the next 12 months, fell to 3.0%, matching pre-tariff levels seen in January. Expectations for long-term inflation remained steady at 3.0% and 2.6%.
Consumers are also more optimistic about their financial futures, with fewer households reporting worsening financial situations and more expecting improvements over the next year. Income expectations have ticked up slightly, while spending growth expectations decreased.
The labor market outlook has improved, with a lower perceived probability of job loss and reduced unemployment expectations. Credit access difficulties have decreased, and expectations for future credit availability have also improved. Overall, the survey suggests that inflation concerns are waning, allowing consumers to feel more confident about their financial futures.
Source: https://qz.com/consumer-expectations-inflation-ny-fed-survey