from the New York Fed
The New York Fed’s Center for Microeconomic Data today released the October 2017 Survey of Consumer Expectations which shows persistent optimism about consumers’ year-ahead financial situations.
The Survey also shows that consumers’ expectations of year-ahead growth in government debt increased again for the third consecutive month. While inflation expectations were relatively stable, year-ahead expectations of food price changes reached their lowest value since the start of our survey in June 2013.
z sce.png
The main findings from the October 2017 Survey are:
Inflation
Median inflation expectations were unchanged at the three-year horizon at 2.8%. They increased slightly at the one-year horizon from 2.5% in September to 2.6% in October.
Median inflation uncertainty—or the uncertainty expressed by respondents regarding future inflation outcomes—increased at both horizons.
Median home price change expectations were unchanged at 3.0%, remaining below its trailing 12-month average of 3.2%. Home price change uncertainty declined slightly.
The median one-year ahead expected gasoline price change decreased from 4.7% in September to 3.8% in October, while expectations for changes in food prices declined from 4.6% to 4.3%, a new series low. Expectations for changes in the cost of medical care and the cost of a college education increased from 9.3% to 9.7% and from 5.9% to 6.6%, respectively.
Labor Market
Median one-year ahead earnings growth expectations decreased from 2.3% in September to 2.1% in October, its third consecutive decline since reaching 2.6% in July of this year.
Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—increased slightly from 35.7% in September to 36.0% in October, remaining just below its past year’s average of 36.7%.
Both the mean perceived probability of losing one’s job in the next 12 months and the mean probability of leaving one’s job voluntarily in the next 12 months increased from 13.8% to 15.3%, and 20.6% to 23.1%, respectively. The increase in the likelihood of job loss was broad-based across education and income groups, while the increase in the likelihood of a voluntary departure was driven by those without college degrees and incomes below $100,000.
The mean perceived probability of finding a job (if one’s current job was lost) decreased from 59.2% to 57.7%, remaining above its past year average of 56.8%.
