Americans said last month that access to credit was at its toughest level in nearly a decade, as they also braced for higher levels of inflation over the next few years, a report from the New York Fed said Monday.
In the March Survey of Consumer Expectations, the bank found that the share of households who said credit is harder to get versus a year ago rose to the highest level in a survey that dates back to 2014. The bank’s report also said, “respondents were more pessimistic about future credit availability as well, with the share of households expecting it will be harder to obtain credit a year from now also rising.”
Meanwhile, households project that inflation a year from now would stand at 4.7%, versus February’s 4.2%. That was the first increase in year-ahead expected inflation since October. Inflation three years from now is seen at 2.8%, from 2.7% the prior month, while five years out, survey respondents said they expected inflation at 2.5%, down from the prior month’s 2.6%.
Despite expectations of higher near-term inflation, respondents to the New York Fed survey see lower gasoline, food and rent costs, while they forecast a 1.8% rise in home prices.
The rise in inflation expectations could prove to be a new challenge for the Federal Reserve’s effort to lower inflation.
Click here to read the full report from Michael S. Derby in Reuters.
