US consumers are expected to spend more on rent and other bills according to Fed survey – 3/8/2021

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(Reuters) – American consumers say they expect to spend more on rents, gas and other essentials next year, a sign that some expect basic costs to rise as the economy crises due to coronovirus According to a survey released on Monday by the Federal Reserve of New York.

Consumers said they expected gas prices to rise by an average of 9.6% next year from an estimated 6.2% increase in January. February was the fifth month of continuous growth and achieved a new status in the survey series launched in 2013.

Fares are expected to rise 9.0% next year, compared to 6.4% in January.

Respondents also raised their expectations for food, medical care, and college costs in the coming year.

The decline in coronovirus infection, distribution of vaccines and additional fiscal support are raising hopes that the US economy is poised for a strong recovery this year. Investors who expect strong inflation are turning to risky assets, leading to increased long-term treasury yields.

The New York Fed survey is based on a rotating panel of about 1,300 homes.

According to the Consumer Expectations Survey, the average of inflation expectations for the following year increased slightly to 3.1% in February, reaching its highest level since February 2014. Inflation estimates were stable at 3.0% over a three-year horizon.

(By Jonel Mars)

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Sarah Gracie

About the author: Sarah Gracie

Sarahis a reporter covering Amazon. She previously covered tech and transportation, and she broke stories on Uber's finances, self-driving car program, and cultural crisis. Before that, she covered cybersecurity in finance. Sarah's work has appeared in The Wall Street Journal, Bloomberg, Politico, and the Houston Chronicle.

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