The Federal Bank of New York released data from a recent survey on Monday, April 14, showing that consumers are becoming increasingly worried about inflation from a short-term perspective. The survey, conducted in March, shows that the median inflation expectations increased by 0.5% from February to 3.6%.
Labor market expectations were also included in the survey, showing a 4.6% mean increase, to 44%, in expectations that unemployment will increase by next year. The 44% increase is the highest since April 2020.
Consumers’ median expected growth in household income for next year decreased by 0.3% to 2.8% in March, short of its trailing 12-month average of 3.0%.
Although the survey was conducted ahead of President Trump’s “Liberation Day” which saw the imposition of multiple tariffs and slides in the stock market, survey participants had a decrease in mean probability of the stock market increasing within 12 months, falling by 3.2% to 33.8%, the lowest since June 2022.
On Monday, April l14, UBS analysts spoke about the condition of the market, stating: “The situation remains fluid, amid continuous twists and turns in developments since the ‘Liberation Day’ announcement less than two weeks ago. But given the 90-day pause on ‘reciprocal’ tariffs and the latest electronics tariff reprieve, we expect the recovery in tech shares to continue.”