Press Release

Short-Term Inflation Expectations Increase; Credit Access Perceptions and Expectations Deteriorate

April 10, 2023

NEW YORK—The Federal Reserve Bank of New York’s Center for Microeconomic Data today released the March 2023 Survey of Consumer Expectations, which shows that inflation expectations increased at the short-term and medium-term horizons, but decreased slightly at the longer-term horizon. Expectations about year-ahead price increases for gas, food, cost of rent, and medical care all continued to decline, while expectations for the cost of college education increased. Home price growth expectations rose but remain below pre-pandemic levels. Credit access perceptions and expectations deteriorated.

The main findings from the March 2023 Survey are:


  • Median inflation expectations increased by 0.5 percentage point at the one-year-ahead horizon to 4.7%, marking the first increase in the series since October 2022. Median inflation expectations increased by 0.1 percentage point at the three-year-ahead horizon to 2.8%, but decreased by 0.1 percentage point at the five-year-ahead horizon to 2.5%. The survey’s measure of disagreement across respondents (the difference between the 75th and 25th percentile of inflation expectations) increased at all three horizons. 
  • Median inflation uncertainty—or the uncertainty expressed regarding future inflation outcomes—increased at the one-year-ahead horizon, decreased at the three-year-ahead horizon, and remained unchanged at the five-year-ahead horizon.
  • Median home price growth expectations increased by 0.4 percentage point to 1.8% in March, remaining far below the 12-month trailing average of 3.0% as well as their pre-pandemic levels. The increase was most pronounced among respondents with no more than a high school education and for those who live in the Midwest Census region.
  • Median year-ahead expected price changes declined by 0.1 percentage point for gas (to 4.6%), 1.4 percentage point for food (to 5.9%), 0.1 percentage point for the cost of medical care (to 9.3%), and 0.2 percentage point for the cost of rent (to 9.2%). Median year-ahead expected cost of college education increased by 0.8 percentage point (to 8.9%). All commodity price expectations remain well above their pre-pandemic (March 2020) levels.

Labor Market

  • Median one-year-ahead expected earnings growth remained unchanged at 3.0% in March. The series has been moving between a narrow range of 2.8% to 3.0% since September 2021; March marked the fourth consecutive month it remained at 3.0%.
  • Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—increased by 1.3 percentage point to 40.7%. The increase was more pronounced for respondents with at least some college education, those between the ages of 40 and 60, and those with annual household incomes between $50k and $100k.
  • The mean perceived probability of losing one’s job in the next 12 months decreased by 0.4 percentage point to 11.4%. The mean probability of leaving one's job voluntarily in the next 12 months also declined by 1.5 percentage point to 19.3%.  
  • The mean perceived probability of finding a job (if one’s current job was lost) declined by 0.3 percentage point to 57.6% in March. The series has been moving between a narrow range of 57.2% to 58.2% since August 2022.

Household Finance

  • Median expected growth in household income increased by 0.1 percentage point to 3.3%.  
  • Median household spending growth expectations increased to 5.7% in March from 5.6% in February. This is the first increase in the series since October 2022. 
  • Perceptions of credit access compared to a year ago deteriorated in March, with the share of households reporting it is harder to obtain credit than one year ago rising and reaching a series high. Respondents were more pessimistic about future credit availability as well, with the share of households expecting it will be harder to obtain credit a year from now also rising.
  • The average perceived probability of missing a minimum debt payment over the next three months increased by 0.3 percentage point to 10.9% in March. The series remains below its 12-month trailing average of 11.4%.
  • The median expectation regarding a year-ahead change in taxes (at current income level) decreased by 0.1 percentage point to 4.2%.
  • Median year-ahead expected growth in government debt declined by 0.3 percentage point to 9.9%. This is the lowest reading of the series since February 2020.
  • The mean perceived probability that the average interest rate on saving accounts will be higher in 12 months increased by 0.7 percentage point to 32.9%.
  • Perceptions about households’ current financial situations improved in March. Year-ahead expectations about households’ financial situations also improved, with fewer respondents expecting to be worse off and more 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 1.4 percentage point to 35.0%.

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.

Connor Munsch
(347) 224-1175
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