The Federal Reserve Bank of New York’s Center for Microeconomic Data's January 2024 Survey of Consumer Expectations indicates an improvement in household perceptions and expectations regarding their financial conditions and credit availability. However, inflation expectations remained static at the short- and longer-term horizons, with a slight decline at the medium-term horizon.
As per a press release by the New York Fed, the survey involved 1,300 household heads. The findings revealed that the median expected growth in household income rose by 0.1 percentage point to 3.1% in January—surpassing the pre-pandemic February 2020 level of 2.7%. Conversely, median household spending growth expectations remained unchanged at 5.0%, albeit higher than the February 2020 level of 3.1%.
The New York Fed's press release also highlighted improvements in household perceptions of credit access compared to a year ago, with more respondents reporting easier access to credit. Additionally, there was a decrease in the average perceived probability of missing a minimum debt payment over the next three months, falling by a 0.3 percentage point to 12.1%.
According to the same source, median inflation expectations stayed constant in January, registering at 3.0% at the one-year ahead horizon and 2.5% at the five-year ahead horizon. However, while median inflation expectations at the three-year ahead horizon declined from 2.6% to 2.4%, median inflation uncertainty experienced a slight increase across all three horizons.
The New York Fed further reported mixed results on labor market expectations from its survey data. The median one-year ahead expected earnings growth increased by 0.3 percentage points to reach 2.8%. This increase was attributed mainly to respondents aged over 40 years who lack a college degree by the Fed. Mean unemployment expectations rose slightly from December's figure of 37.0% to 37.2%. However, the mean perceived probability of losing one's job in the next 12 months decreased, falling by 1.6 percentage points to 11.8%.