Consumers’ Outlook on Finances, Credit Availability Improves

The Federal Reserve Bank of New York’s monthly Survey of Consumer Expectations for December shows consumers’ expected household financial situation also improved.

1/25/2018 8:00 AM

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Consumers’ Outlook on Finances, Credit Availability Improves

Consumers’ outlook on their financial situations and credit availability improved at the end of 2017, while their expectations about income and spending growth declined, according to the Federal Reserve Bank of New York’s latest Survey of Consumer Expectations for December.

“Labor market expectations continued to improve, with expectations about earnings growth and unemployment reaching levels not seen since late 2014,” according to a news release from the Fed.

For example, the median one-year-ahead earnings growth expectations continued to rise, from 2.6 percent in November to 2.7 percent in December 2017. Consumers’ expectations last improved at that level in November 2014, according to the Fed.

Consumers’ mean unemployment expectations—defined as the mean probability that the U.S. unemployment rate will be higher a year from now—also reached a record low of 33.5 percent in December. The decline from November to December was just 0.2 percentage points, but consumers’ expectations last reached that level in December 2014, according to the Fed.

Main findings on household finance and credit availability from the survey include:

  • Median expected household income growth decreased 0.2 percentage points in December, to 2.8 percent, but remained in line with the trailing 12-month average of 2.7 percent.
  • After a significant increase in November, median household spending growth expectations declined 0.7 percentage points in December, to 2.9 percent, thereby returning to the average level seen between March and October 2017.
  • The household’s expected financial situation improved, with 43.2 percent of respondents expecting to be better off financially a year from now, compared to 42.2 percent in November.
  • The perceived change in credit availability compared to a year ago improved slightly, as did year-ahead expected credit availability. In particular, the proportion of respondents reporting that credit has become harder to get relative to 12 months ago reached a new series low.
  • The average perceived probability of missing a minimum debt payment over the next three months was unchanged, at 12.5 percent.

The Survey of Consumer Expectations is based on consumers’ expectations for overall inflation and how they expect prices for food, gas, housing and education to behave. It also shows consumers’ views on job prospects, earnings growth, and their expectations about future spending and access to credit.

The full survey results are available on the Fed’s website.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Consumers’ Outlook on Finances, Credit Availability Improves

Consumers’ outlook on their financial situations and credit availability improved at the end of 2017, while their expectations about income and spending growth declined, according to the Federal Reserve Bank of New York’s latest Survey of Consumer Expectations for December.

“Labor market expectations continued to improve, with expectations about earnings growth and unemployment reaching levels not seen since late 2014,” according to a news release from the Fed.

For example, the median one-year-ahead earnings growth expectations continued to rise, from 2.6 percent in November to 2.7 percent in December 2017. Consumers’ expectations last improved at that level in November 2014, according to the Fed.

Consumers’ mean unemployment expectations—defined as the mean probability that the U.S. unemployment rate will be higher a year from now—also reached a record low of 33.5 percent in December. The decline from November to December was just 0.2 percentage points, but consumers’ expectations last reached that level in December 2014, according to the Fed.

Main findings on household finance and credit availability from the survey include:

  • Median expected household income growth decreased 0.2 percentage points in December, to 2.8 percent, but remained in line with the trailing 12-month average of 2.7 percent.
  • After a significant increase in November, median household spending growth expectations declined 0.7 percentage points in December, to 2.9 percent, thereby returning to the average level seen between March and October 2017.
  • The household’s expected financial situation improved, with 43.2 percent of respondents expecting to be better off financially a year from now, compared to 42.2 percent in November.
  • The perceived change in credit availability compared to a year ago improved slightly, as did year-ahead expected credit availability. In particular, the proportion of respondents reporting that credit has become harder to get relative to 12 months ago reached a new series low.
  • The average perceived probability of missing a minimum debt payment over the next three months was unchanged, at 12.5 percent.

The Survey of Consumer Expectations is based on consumers’ expectations for overall inflation and how they expect prices for food, gas, housing and education to behave. It also shows consumers’ views on job prospects, earnings growth, and their expectations about future spending and access to credit.

The full survey results are available on the Fed’s website.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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