Inflation expectations are stable in the USA, unemployment concerns are increasing

While the short, medium and long-term inflation expectations of consumers in the USA did not change in October, the expectation that the unemployment rate would increase reached its highest level since April 2020 with 45.3 percent.

Short, medium and long-term inflation expectations of consumers in the USA remained unchanged in October at 3.9 percent, 3.3 percent and 3 percent, respectively.

The New York Branch of the US Federal Reserve (Fed) announced the results of the Consumer Expectations Survey for October.

According to the results of the survey in which approximately 1300 households participated, the median inflation expectation for the next 12 months remained unchanged compared to the previous month, reaching 3.9 percent in October.

Consumers' medium-term inflation expectation remained constant at 3.3 percent, and long-term inflation expectation remained constant at 3 percent.

The median expectation for the increase in house prices remained unchanged at 3 percent.

When the expectations for price increases in basic expenditure items in the next 12 months are examined, the expectation for gasoline prices decreased by 0.6 points to 4.2 percent, while the expectation for food prices remained at 5.5 percent.

The expectation for an increase in health care costs increased by 0.1 point to 9.3 percent, and the expectation for university education costs increased by 0.1 point to 7.6 percent.

The expectation for rent increases increased by 0.9 points and reached 7.7 percent.

While the unemployment rate and expectations for job loss worsened, expectations for the possibility of finding a new job improved.

The average expectation that the unemployment rate in the USA will increase in the next year increased by 1.4 points to 45.3 percent. Thus, the expectation reached its highest level since April 2020.

Participants' average expectation of the possibility of losing their job in the next 12 months increased by 0.4 points to 13.9 percent.

Their expectations regarding the possibility of finding a new job if they lose their current job increased by 0.4 points, reaching 46.5 percent.

Thus, the expectation of finding a new job recorded its highest level since November 2025.

While households' expectations regarding income and expenditure growth remained generally stable, there was a deterioration in expectations of default in debt payments.

The median expected increase in household income decreased by 0.1 percentage points to 3 percent.

The expectation for the increase in household expenditures in the next 12 months was recorded as 5.3 percent, with a decrease of 0.2 points.

On the other hand, the Consumer Price Index (CPI) in the USA increased by 0.6 percent on a monthly basis and 3.7 percent on an annual basis in September.

CPI data for October is expected to be announced tomorrow.