NY Fed consumer inflation expectations rise to 3.42% in December

The Federal Reserve Bank of New York reported that consumer inflation expectations for the one-year horizon increased to 3.4% in December 2025, up from 3.2% in the previous month. The survey showed inflation expectations remained unchanged at 3.0% for both three-year and five-year horizons.

The December Survey of Consumer Expectations, conducted from December 1-31, 2025, revealed mixed economic sentiment among households. Job finding expectations fell to a series low of 43.1%, marking the second such low in six months. The perceived probability of job loss increased by 1.4 percentage points to 15.2%.

Delinquency expectations reached their highest level since April 2020, with the average perceived probability of missing a debt payment rising 1.6 percentage points to 15.3%. The increase was most pronounced among respondents over 60, those with high school education or less, and households earning below $50,000 annually.

Home price growth expectations held steady at 3.0% for the seventh consecutive month. Commodity price expectations declined across categories, with gas expectations dropping to 4.0%, food to 5.7%, medical care to 9.9%, college education to 8.3%, and rent to 7.7%.

Household income growth expectations increased slightly to 3.0%, while spending growth expectations decreased to 4.9%. Credit access perceptions deteriorated, with more households reporting difficulty obtaining credit compared to a year ago.

Despite concerns about debt payments and job prospects, respondents expressed improved optimism about their future household financial situations, with the highest share expecting better conditions since February 2025.

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