News

(Bloomberg) -- US consumers said they see higher inflation over the next few years than previously thought, a monthly Federal Reserve Bank of New York survey showed, in the latest sign of mounting concerns about prices following November’s elections.

Expected inflation three years ahead rose to 3% in December from 2.6% the month before, according to results of the New York Fed’s Survey of Consumer Expectations published Monday. Expected inflation over the next year was unchanged at 3%, and expected inflation five years ahead declined to 2.7% from 2.9%.

The findings follow the release of preliminary results of a monthly University of Michigan survey published Friday, which showed long-term inflation expectations — five to 10 years ahead — jumped this month to the highest since 2008 on concerns about potential tariffs from the incoming Trump administration. They also showed consumers see prices rising 3.3% over the next year, up half a percentage point from December’s survey.

Investors have scaled back bets on Fed interest-rate cuts in recent weeks and the yields on benchmark 10-year Treasury notes have risen to the highest in over a year as inflation worries have seeped into financial markets. The surveys indicate households also remain uncertain about the central bank’s ability to return inflation to its target in the near term. Monthly data on consumer prices are due Wednesday from the Bureau of Labor Statistics.

The New York Fed report showed mixed sentiment on the labor market: While the perceived likelihood of job loss fell, the chances of leaving one’s job voluntarily also declined — and the perceived chances of finding a new position in the event of job loss fell to 50.2%, the lowest level since April 2021.

Consumers are also growing more concerned about their ability to keep up with debt payments, according to the survey results. The perceived odds of missing a minimum debt payment over the next three months rose to 14.2%, matching the highest reading since April 2020. Those earning more than $100,000 reported the highest probability of missing a payment in more than 10 years.