US inflation outlook firms; short-term expectations climb

US households expect higher inflation in the near term, with the Federal Reserve Bank of New York’s March 2026 Survey showing one-year-ahead expectations rising to 3.4 per cent and three-year outlook edging up to 3.1 per cent, while the five-year view held steady at 3 per cent.

Gas price growth expectations surged sharply to 9.4 per cent, the highest since March 2022, signalling renewed pressure on household budgets, the Federal Reserve Bank of New York said in a press release.

US households expect higher near-term inflation, with one-year expectations rising to 3.4 per cent, driven by a sharp spike in gas price outlook to 9.4 per cent.
While job-finding prospects improved, unemployment concerns increased.
Household sentiment weakened amid rising spending expectations and stable income growth, with greater uncertainty and pessimism about future financial conditions.

The labour market sentiment showed mixed signals. Job-finding expectations improved, but concerns about unemployment rose, with the probability of higher joblessness climbing to 43.5 per cent, the highest since April 2025. The likelihood of job loss also increased marginally.

Household financial sentiment weakened, as more respondents reported deteriorating current and future financial conditions. While income growth expectations remained steady at 2.9 per cent, spending expectations rose slightly to 5.1 per cent, indicating persistent cost pressures.

Credit access perceptions improved compared to a year ago, though expectations for future availability worsened. Meanwhile, inflation uncertainty increased across all horizons, reflecting growing economic unease among US households.

Fibre2Fashion News Desk (SG)