Consumer Inflation Expectations Rise, Labor Market Outlook Worsens in September

The Federal Reserve Bank of New York’s Center for Microeconomic Data recently released the September 2025 Survey of Consumer Expectations, detailing inflation expectations among U.S. households, showing an increase in inflation expectations in short- and long-term outlooks.

Median inflation expectations in September increased at the one-year-ahead horizon to 3.4% from 3.2% and at the five-year-ahead horizon to 3.0% from 2.9%. In September, median home price growth expectations remained unchanged at 3.0% for the fourth month in a row.

The survey also found that labor market expectations continued to decrease, with consumers reporting lower expected earnings growth, a higher likelihood of losing jobs and a higher likelihood of a rise in overall unemployment. The mean perceived probability of finding a job in the next three months if one’s current job was lost was reported at 47.4%, up from 44.9% in August.

The median expected growth in household income remained unchanged at 2.9% with median nominal household spending growth expectations decreasing by 0.3% to 4.7%, falling below the 12-month average of 4.9%.