According to a survey by the Federal Reserve Bank of New York, in May, the US public had mixed views on future inflation trends, with short-term inflation expectations slightly decreasing and long-term inflation expectations slightly increasing.

Meanwhile, the optimism of the public towards the stock market in the coming year has reached its highest level in three years, reflecting that the strong performance of the US stock market is boosting consumer confidence.

However, respondents also indicated that the job market outlook remains challenging, and they anticipate that the unemployment rate may rise in the future. This mixed economic expectation reflects the complexity of the current economic environment, and future policy formulation may need to find a balance between stimulating the economy and controlling inflation.

Inflation expectations

One year inflation expectation: decreased from 3.3% in April to 3.2%.

Three year inflation expectations: remain unchanged at 2.8%.

Five year inflation expectation: increased from 2.8% in April to 3%.

Price expectations

Expected increase in housing prices: The annual growth rate remains stable at 3.3%.

Expected gasoline price: Maintain at 4.8%.

Expected food prices: remain at 5.3%.

Expected rental growth rate: 9.1% growth.

Medical expenses are expected to be higher than in April.

Market Outlook

The possibility of a stock market rise: Consumers believe that the likelihood of a stock market rise in the next year is 40.5%, a new high since May 2021.

Optimism is widespread: Optimism is generally increasing across age groups, educational levels, and regions.

Consumer confidence

Financial condition expectation: The proportion of surveyed consumers who expect their financial condition to remain unchanged or better in one year has risen to 78.1%, reaching a new high since June 2021.

Job market

Unemployment rate expectation: Respondents believe that there is an increased likelihood of an increase in unemployment rate in one year.