MNI POLICY: NY Fed Survey: Slow Rise in Consumer Expectations

By Evan Ryser

     WASHINGTON (MNI) - U.S. consumer views of job security showed improvement

in June as perceptions of income and job finding ticked up and expectations of

missing debt payments declined in the New York Federal Reserve's latest consumer

survey.

     Consumer views of losing one's job in the next 12 months declined 3.6pp to

15.0% in June, the lowest value since reaching 13.8% in February, according to

the survey.

     High unemployment expectations for one year from now fell to 35.1% in June,

from 38.9% in May and 50.9% in March. The current reading is now just above the

February level of 34.2%. 

     The mean perceived probability of finding a job, however, if one's current

job was lost, decreased from to 47.6% in June from 48.3% in May, remaining well

below its year-ago level of 63.7%, the survey showed. 

     --EARNINGS

     Consumers remain less optimistic about earnings. One-year ahead expected

earnings growth declined to a series low of 1.6% in June from 2.0% in May, well

below the 12-month trailing average of 2.3%. 

     The internet-based survey with a rotating panel of 1,300 households also

showed the average probability of missing a future minimum debt payment reached

a new series low at 9.8% in June, down from 12.6% in May. 

     The survey of consumer expectations, one of the Fed's price gauges as it

weighs interest rates policy, showed median inflation expectations at the

one-year horizon declined to 2.7% in June from 3.0% in May. 

     The survey's measure of disagreement between the 75th and 25th percentile

of inflation expectations also declined at both horizons.

     And median inflation uncertainty, or the uncertainty expressed regarding

future inflation outcomes, decreased at both horizons while still elevated

relative to pre-COVID-19 readings.

--MNI Washington Bureau; +1 202 371 2121; email: evan.ryser@marketnews.com

[TOPICS: MAUDS$,MMUFE$,M$U$$$]