US inflation expectations diverge as unemployment fears reach 44.4%

Sep 7, 2026 23:11 (48d ago)

One-year inflation expectations reached about 5.0% among U.S. consumers without stock holdings, while the broader New York Fed median remained at 3.6% in August 2026.
The mean probability of higher unemployment in a year rose 1.6 percentage points to 44.4%, the highest since April 2020; the probability of missing a minimum debt payment rose to 13.2%.
The New York Fed surveyed roughly 1,300 household heads from August 3 through August 31, finding expected income growth of 3.0% versus spending growth of 5.2% and weaker job-finding prospects.

The three-month moving average of one-year inflation expectations among U.S. consumers with no stock holdings reached about 5.0% in August 2026, near its highest level of the year and above roughly 3.0% in late 2024. Separately, the Federal Reserve Bank of New York's August Survey of Consumer Expectations showed median one-year inflation expectations unchanged at 3.6%, three-year expectations easing to 3.2% from 3.3% and five-year expectations holding at 3.0%. The survey also found a record-high since April 2020 perceived probability of higher unemployment in a year, rising debt-payment concerns, weaker household finances and a widening gap between expected income and spending growth.