from the New York Fed

The Federal Reserve Bank of New York’s Center for Microeconomic Data released the February 2018 Survey of Consumer Expectations, which shows a slight increase in short- and medium- term inflation expectations. Consumers’ expectations about their personal financial situations continued to improve.

Expectations about changes in taxes declined to a new series’ low, while expectations about growth in government debt increased sharply.

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The main findings from the February 2018 Survey are:


  • Median inflation expectations increased by 0.1 percentage points at both the one-year and three-year horizons in February, to 2.8% and 2.9%, respectively. The increase was driven largely by higher educated respondents (with a college degree or more).
  • Median inflation uncertainty—or the uncertainty expressed by respondents regarding future inflation outcomes—declined to series’ lows at both horizons.
  • Median home price change expectations declined from 3.5% in January to 3.3% in February, remaining slightly higher than its 2017 average of 3.2%. Home price change uncertainty also declined.
  • The median one-year ahead expected gasoline price change and food price change remained flat in February. Expectations for a change in the cost of college education declined from 7.8% to 6.0%.
  • Labor Market

  • Median one-year ahead earnings growth expectations remained flat at 2.7% in February.
  • Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—decreased from 32.4% in January to 32.3% in February, reaching a new series’ low.
  • 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 declined, from 14.9% to 12.8%, and from 22.1% to 21.4%, respectively. The declines were broad-based across all demographic groups.
  • The mean perceived probability of finding a job (if one’s current job was lost) remained unchanged at 59.7% in February, just 0.4 percentage points below the series’ high reached in November 2017.
  • The mean probability of changing residence over the next 12 months, reversed its drop seen in January. It increased sharply from 15.9% to 18.3%, reaching the level of its trailing 12-month average.
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