2 Min Read
NEW YORK (Reuters) - A measure of short-term U.S. inflation expectations rose sharply in December, and Americans are more optimistic about the outlook for the labor market and their household finances, according to a Federal Reserve Bank of New York survey released Monday.
The survey of consumer expectations, an increasingly influential gauge of prices for the U.S. central bank, found that inflation is expected to accelerate over both one-year and three-year horizons.
It found that year-ahead inflation expectations shot up to a median of 2.8 percent in December from 2.5 percent in November. The prior month's reading had matched the survey's lowest recorded level.
Three-year ahead expectations edged up to 2.8 percent from 2.7 percent, near a record low for the online survey that has shown a gradual decline in both price measures since it began in mid-2013.
Since Republican Donald Trump was elected U.S. president in November, a number of market-based inflation expectations have risen sharply. The Fed raised interest rates by a quarter point in December and is expected to raise them at least twice in 2017.
Survey respondents were also more optimistic about the job market and their own finances.
The probability of finding a new job in the event of losing a current one jumped to 55.6 percent last month from 53 percent in November, the survey found. And the median expected growth in household income rose to 2.8 percent from 2.4 percent a month earlier.
Reporting by Dan Burns; Editing by Bernadette Baum