Key Point: “Households expressed more pessimism about their year-ahead financial situations in February, while unemployment, delinquency, and credit access expectations deteriorated notably. … Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—jumped 5.4 percentage points to 39.4%.”

Federal Reserve Bank of New York: Consumers’ Pessimism About Their Future Financial Situations Increases

• Households expressed more pessimism about their year-ahead financial situations in February, while unemployment, delinquency, and credit access expectations deteriorated notably. 

• Median home price growth expectations increased by 0.1 percentage point to 3.3%.
  
• Median expected price growth increased by 1.1 percentage points for gas to 3.7% (its highest level since June 2024), 0.5 percentage point for food to 5.1% (its highest level since May 2024), 0.4 percentage point for the cost of medical care to 7.2%, 1.0% percentage point for the cost of a college degree to 6.9%, and 0.7 percentage point for rent to 6.7%.
  
• Mean unemployment expectations—or the mean probability that the U.S. unemployment rate will be higher one year from now—jumped 5.4 percentage points to 39.4%, its highest reading since September 2023. The increase was broad-based across age, education, and income groups.

• The average perceived probability of missing a minimum debt payment over the next three months increased by 1.3 percentage points to 14.6%, the highest level since April 2020.