NEW YORK—The Federal Reserve Bank of New York’s Center for Microeconomic Data today released the April 2024 Survey of Consumer Expectations, which shows that inflation expectations increased at the short-term and longer-term horizons, while decreasing at the medium-term horizon. Home price growth expectations reached the highest level since July 2022. Spending growth expectations also increased. The average perceived likelihood of voluntary and involuntary job separation declined, as did the perceived likelihood of finding a job in the event of a job loss.
The main findings from the April 2024 Survey are:
Inflation
- Median inflation expectations increased to 3.3% from 3.0% at the one-year horizon (remaining below its 12-month trailing average of 3.5%), decreased to 2.8% from 2.9% at the three-year horizon, and increased to 2.8% from 2.6% at the five-year horizon. The survey’s measure of disagreement across respondents (the difference between the 75th and 25th percentile of inflation expectations) decreased at the one-year horizon and increased at the three-year and five-year horizons.
- Median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—increased at the one- and five-year horizons and declined at the three-year horizon.
- Median home price growth expectations increased to 3.3% after remaining unchanged at 3.0% for seven consecutive months. This is the highest reading of the series since July 2022. The increase was most pronounced for respondents with a high school degree or less.
- Year-ahead commodity price expectations rose across the board in April, increasing by 0.3 percentage point for gas to 4.8%, 0.2 percent point for food to 5.3%, 0.6 percent point for the cost of medical care to 8.7%, 2.5 percentage points for the cost of college education to 9.0% and 0.4 percentage point for rent to 9.1%.
Labor Market
- Median one-year-ahead expected earnings growth decreased by 0.1 percentage point to 2.7%. The decline was driven by respondents with a high school degree or less. While lower, the current reading remains well above the 2.0%-2.2% levels prevailing at the onset of the pandemic.
- Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—increased by 1 percentage point to 37.2%, remaining below its 12-month trailing average of 38.2%.
- The mean perceived probability of losing one’s job in the next 12 months decreased by 0.6 percentage point to 15.1%. The mean probability of leaving one’s job voluntarily in the next 12 months also declined, by 1.2 percentage points to 19.4%.
- The mean perceived probability of finding a job if one’s current job was lost declined for the fourth consecutive month, to 50.9% from 51.2% in March. This is the lowest reading of the series since April 2021.
Household Finance
- Median expected growth in household income declined by 0.1 percentage point to 3.0%. The series has been moving within a narrow range of 2.9% to 3.3% since January 2023, and remains above the February 2020 pre-pandemic level of 2.7%.
- Median household spending growth expectations increased by 0.2 percentage point to 5.2%. The increase was most pronounced for respondents with some college education.
- Perceptions of credit access compared to a year ago improved with a smaller share of respondents reporting tighter conditions compared to a year ago. Expectations about credit access a year from now also improved with a smaller share of respondents expecting tighter credit a year from now.
- The average perceived probability of missing a minimum debt payment over the next three months remained unchanged at 12.9%. The series remains above its 12-month trailing average of 11.8%.
- The median expected year-ahead change in taxes at current income level increased by 0.1 percentage point to 4.3%.
- Median year-ahead expected growth in government debt remained unchanged at 9.6%.
- The mean perceived probability that the average interest rate on saving accounts will be higher 12 months from now increased by 1.3 percentage points to 25.5%, remaining below its 12-month trailing average of 28.8%.
- Perceptions about households’ current financial situations deteriorated with fewer respondents reporting being better off and more respondents reporting being worse off than a year ago. Year-ahead expectations also deteriorated marginally with a smaller share of respondents expecting to be better off a year from now.
- The mean perceived probability that U.S. stock prices will be higher 12 months from now decreased by 0.5 percentage point to 38.7%.
About the Survey of Consumer Expectations (SCE)
The SCE contains information about how consumers expect overall inflation and prices for food, gas, housing, and education to behave. It also provides insight into Americans’ views about job prospects and earnings growth and their expectations about future spending and access to credit. The SCE also provides measures of uncertainty regarding consumers’ outlooks. Expectations are also available by age, geography, income, education, and numeracy.
The SCE is a nationally representative, internet-based survey of a rotating panel of approximately 1,300 household heads. Respondents participate in the panel for up to 12 months, with a roughly equal number rotating in and out of the panel each month. Unlike comparable surveys based on repeated cross-sections with a different set of respondents in each wave, this panel allows us to observe the changes in expectations and behavior of the same individuals over time. For further information on the SCE, please refer to an overview of the survey methodology here, the interactive chart guide, and the survey questionnaire.
