NY Fed Survey of Consumers shows inflation relief, jobs-market unease
The New York Fed revealed the August Survey of Consumer Expectations in which households' inflation expectations dipped in the medium-term, while expectations about the labor market remained mixed, as unemployment and job finding deteriorated, while job losses and quit expectations improved.
The August Survey of Consumer Expectations from the New York Fed revealed a dip in inflation expectations over the medium-term, while labor market outlooks remained mixed. Unemployment and job finding expectations worsened, but expectations about job losses and quitting improved. Yearly inflation expectations remained at 3.58% for the next year, compared to a forecast of 3.6% and a previous expectation of 3.63%.
The 5-year inflation expectation stayed unchanged at 3% in August. In August, consumers expected a higher unemployment rate, the highest since April 2020, while labor market expectations were mixed. They also projected higher future gasoline prices, and views about their personal financial situations deteriorated. The US Dollar was strongest against the New Zealand Dollar.
The Federal Reserve's two mandates are price stability and full employment, achieved through interest rate adjustments. When inflation is above 2%, the Fed raises rates, strengthening the USD by making it more attractive for international investors. When inflation falls below 2% or unemployment is too high, the Fed lowers rates to encourage borrowing, weakening the USD.
The Fed holds eight policy meetings a year to assess economic conditions and make monetary policy decisions.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
