Inflation expectations for January improve to 3.1%, U.S. consumers' outlook brightens

According to the latest survey from the Federal Reserve Bank of New York, there has been a positive shift in outlook regarding the U.S. economy in January. Inflation refers to rising prices, but this survey highlights an interesting point: how consumers perceive inflation.

Lower inflation expectations are key, and consumer sentiment is easing.

The survey shows that consumers now expect a 3.1% increase in prices over the next year, down from 3.4% last month, an improvement of 0.3 percentage points. As basic understanding of inflation improves, consumers seem to anticipate a slowdown in the pace of price increases.

Meanwhile, inflation expectations for the next three and five years remain steady at 3%, indicating expectations of stable, moderate price growth in the medium to long term.

Lower unemployment risk is also restoring confidence in the job market.

Notably, the perception of reduced risk of unemployment is a positive sign for labor market stability.

Of particular interest is that the likelihood of finding a new job within three months after losing one has increased to approximately 46%. This figure reflects a consumer confidence in the job market and ease of transitioning between jobs.

Consumers are cautiously optimistic about their financial situation.

Regarding personal finances, the proportion of consumers who believe their financial condition will improve in the next year is roughly equal to those who expect it to worsen. This indicates divided market views and suggests that consumers are assessing household impacts of inflation from multiple perspectives.

Overall, concerns about inflation are easing, and confidence in the employment market is recovering. These shifts in consumer psychology will be important indicators for predicting future trends in the U.S. economy.