Exclusive interviews with leading policymakers that convey the true policy message that impacts markets.
Reporting on key macro data at the time of release.
Real-time insight on key fixed income and fx markets.
- Emerging MarketsEmerging Markets
Real-time insight of emerging markets in CEMEA, Asia and LatAm region
- MNI ResearchMNI Research
Actionable insight on monetary policy, balance sheet and inflation with focus on global issuance. Analysis on key political risk impacting the global markets.
- About Us
--Expected Household Spending, Income, and Earnings Growth Rises
--One-Year and Three-Year Infl Expectations Ahead Unch at 2.6% and 2.8%
--Expected Household Income Growth Hit a Series' High With 3.0%
By Sara Haire
WASHINGTON (MNI) - Consumers are expecting the labor market and household
finance to strengthen and grow, while the one-year and three-year ahead
inflation expectations are unchanged at 2.6% and 2.8%, respectively, the New
York Federal Reserve Bank reported Monday.
The survey reported that the median of respondents expressing uncertainty
regarding future inflation outcomes declined to series' lows at 2.21% for the
one-year ahead and 2.24% for the three-year ahead.
The median home price change expectation saw an increase to 3.3% from 3.0%
in November, still above the trailing 12-month average of 3.2%, while home price
change uncertainty remained flat.
The expectations for a change in the cost of college education saw a jump
to 8.0% from 6.6%, supported by the College Board's annual report indicating
average increases in tuition and fees from 2.9% to 3.6% this year, and are
continuing to rise.
The year-ahead expected gas price change increased to 4.3% from 3.8% in
--FIRMING LABOR MARKET
As the FOMC deliberates the path of future interest rates, survey-based
measures indicating changes in the economy, specifically in the labor market
holds immense value. The New York Fed indicates that the median expectations for
one-year ahead earnings growth saw a rebound to 2.6% from 2.1% in October, a
level not seen since July of this year. The increase was driven by those with
less than a college education.
Both the perceived probability of losing one's job and leaving one's job
voluntarily in the next year saw declines to 13.5% and 21.5%, respectively. In
addition, the mean perceived probability of finding a job increased to 60.1%
from 57.7%, well above the trailing 12-month average of 57.1%.
The expectation that the unemployment rate will be higher one year from now
fell to 33.7% from 36.0%, not surprising considering fewer people are looking to
leave their jobs, but if they did, they expect they would be able to find a job.
However, the unemployment rate has been sitting at a 17-year low, possibly
growing closer to full employment.
--HOUSEHOLD FINANCE RISING
Household spending growth expectations saw an increase to 3.6% in November,
up from 2.8% in October. Despite the increase, this level reaching above the
12-month average of 3.1%. "The increase was broad-based across education and
income groups," the survey stated.
Falling in line with the increase in household spending growth
expectations, the median expected household income growth jumped to 3.0% in
November, up from 2.6%, reaching a new series' high.
In addition to the decrease in expected growth for household income, the
median expected growth in earnings for the year ahead saw a small decrease to
2.5%, down from 2.6%. This continues to be above the 12-month average of 2.3%.
The median expectation, however, regarding year-ahead change in taxes
remained flat at 2.3%, while 42.2% of respondents expect to be better off
financially, this is up from the 30.9% in October and 37.7% seen in November
Despite the median expectation of a change in taxes in the year ahead
remaining at 2.3%, the expectation of growth in the year ahead for government
debt saw a sharp rise to 7.8% from 5.9%, "a level not seen since November 2015,"
the survey reported.
--MNI Washington Bureau; +1 212-800-8517; email: email@example.com