Households expressed more pessimism about their year-ahead financial situations in February, while unemployment, delinquency and credit access expectations deteriorated notably.
Meanwhile, spending growth expectations rose significantly. Average quit probabilities among those employed fell to the lowest level since July 2023, a release from the bank said.
Median inflation expectations increased by 0.1 percentage point at the one-year horizon to 3.1 per cent, and were unchanged at the three-year and five-year horizons (both at 3 per cent) in February.
The survey’s measure of disagreement across respondents decreased at the one-year horizon and was unchanged at the three- and five-year horizons.
Median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—increased at all three horizons.
US median home price growth expectations increased by 0.1 percentage point to 3.3 per cent. Median one-year-ahead earnings growth expectations were unchanged at 3 per cent in February.
Mean unemployment expectations—or the mean probability that the US unemployment rate will be higher one year from now—jumped by 5.4 percentage points to 39.4 per cent—its highest reading since September 2023. The increase was broad-based across age, education and income groups.
The mean perceived probability of losing one’s job in the next 12 months decreased by 0.1 percentage point to 14.1 per cent.
ALCHEMPro News Desk (DS)
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