US households show highest level of financial worry since 2022, Fed report says
According to the Fed survey, the percentage of Americans who consider their economic situation to be “somewhat worse” than a year ago increased to 43%
According to a report published this Monday by the Federal Reserve Bank of New York, the financial worry of American households has shown its highest level in the last four years amid rampant inflation and economic uncertainty.
The results of the Fed survey showed that the total number of people who consider that their economic situation is “somewhat worse” than a year ago increased to 43%, while the percentage of people who believe that their economic situation is “much worse” increased to 13% in one year.
Regarding the prospects for next year, 22% indicated that the economic situation will improve, compared to 36% who predict that the country's economic scenario will worsen considerably.
The report also highlights that inflation prospects for this year increased to 3.5% and for five years to 3%, and in the face of skyrocketing gasoline prices, consumer expectations fell by up to 5%. While, regarding other expenses such as food or rent, expectations increased to 5.8% and 7.4% respectively.
Currently, the inflation rate is at 3.8%, its highest level since 2023; Although the Fed's monetary policy regulators have boosted interest rates to control consumer spending and curb inflation in recent months, the spike in prices also occurs at a time of great political tension with the development of the conflict in the Middle East.
Recently, the analysis of the latest edition of the Fed's Beige Book was released, which reveals that, in recent weeks, American consumers have felt the strong pressure of rising energy prices. “Prices increased at a moderate to strong pace overall, with most districts reporting higher inflation than in the previous report,” the report highlights.
This week, the Bureau of Labor Statistics will release the report on inflation data based on the May Consumer Price Index; So far it is expected that the general inflation rate increased to plus 4% and the underlying inflation rate to 2.9%.
For its part, the next meeting of the Federal Open Market Committee (FOMC) will be held on Wednesday, June 17 to hear the Fed's decision on interest rates.