Consumers fears about inflation increase over past month, study says

April 11 (UPI) -- Consumers are experiencing a record-high fear about climbing prices as inflation concerns continue around the country, according to a new study released Monday by the New York Federal Reserve.

The survey, taken in March, showed while anxiety over inflation in the medium term decreased, short-term inflation worries are currently at high levels. A median of those participating in the survey see inflation rising to 6.6% next year from 6% they saw in February.

Over the next three years, though, they expect to see inflation decrease to 3.7%.

"The decline in medium-term expectations was driven by respondents with no college education and with annual household incomes under $50,000," the study said. "Disagreement across respondents (as measured by the difference between the 75th and 25th percentiles of inflation expectations) increased at both horizons to new series highs."

Consumers said they expect rent prices to rise 10.2% in a year, medical care by 9.6% and gas prices by 9.6%. The respondents said, though, they saw the cost of college decreasing 8.5%.

As far as the labor market, consumers are expected their earnings to grow at about 3% but see their household income fall 0.2% in March to 3%. The survey said that is the lowest level for household finances since August 2021.

The median expected increase in household spending increased 1.3 points from last month to 7.7% for next year.

"The increase, the largest month-to-month increase in the series, was broad based but was largest for respondents with a college degree and with annual household incomes above $100,000," the survey said.

"Perceptions of credit access compared to a year ago deteriorated in March, with more respondents finding it harder to obtain credit now than a year ago. Expectations about future credit availability deteriorated as well, with more respondents expecting that it will be harder to obtain credit in the year ahead."