U.S. consumers expect their income growth to slow and, along with that, they see their pace of spending slowing too, according to the New York Fed's October 2020 Survey of Consumer Expectations.
Median expected household income growth declined to 2.1% in October, down by 0.3 percentage point from September. Since February, the series has stayed within a 1.9%-2.3% range, well below its 2019 average of 2.8%. The decrease was driven by respondents without a college education, the NY Fed said.
Median household spending growth expectations fell to 3.1% in October from 3.4% in September. More consumers also expected credit to become more difficult to get.
The average perceived probability of missing a minimum debt payment over the next three months fell to 9.3% last month vs. 10.7% in September and remains below the 2019 average of 11.5%.
Consumers were a bit more optimistic about keeping their jobs in the next year — the mean perceived probability of losing one's job in the next 12 months declined to 15.5% from 16.6% in September.
But the mean perceived probability of finding a job (if their current job was lost) fell to 46.9% from 49.9% in September, bringing it to its lowest reading since April 2014.
Median inflation expectations fell at the short-term horizon and were unchanged at the medium-term horizon. Inflation expectations at the three-year horizon remains above pre-COVID-19 levels.
With the prospect of a new administration in the White House and progress in COVID-19 vaccines, it will be interesting to see what happens in the November survey.
No comments:
Post a Comment