Consumer Inflation Expectations Steady as Job Security Improves

Consumer inflation expectations held steady in November, with the Federal Reserve Bank of New York's monthly Survey of Consumer Expectations reporting median inflation expectations at 3.2 percent for the one-year horizon and unchanged at 3.0 percent for both the three-year and five-year horizons.

Perceptions of job security reached their strongest level of the year, with the probability of losing one's job falling to 13.8 percent, the lowest in 2025. However, a notable deterioration in perceptions about household financial situations was observed, with a rising share of respondents indicating their households were worse off compared to a year ago.

Despite these improvements in inflation and labor market expectations, the net share of respondents expecting easier credit access a year from now decreased. This data suggests that while inflation expectations remain stable, concerns about household financial wellbeing may lead to cautious lending practices among banks.

The Federal Reserve is expected to respond to these trends, with speculation of a quarter percentage point interest rate cut at its upcoming meeting, as it seeks to balance inflation control with economic growth.