Dec 8 (Reuters) - U.S. households grew more downbeat on their current and future financial situations in November, even as their expectations for the future trajectory of inflation held steady, a New York Federal Reserve report released on Monday showed.
The regional Fed bank said in its Survey of Consumer Expectations for November that respondents' views on their current financial situations "deteriorated notably" while their outlook a year from now "deteriorated slightly."
Survey respondents' views
on the job market, however, got better in November. The report said that expectations of higher unemployment a year from now ebbed, while the expectation of losing a job at some point over the next year cooled to its lowest reading since December 2024. Households also downgraded the probability of leaving a job voluntarily.
The report was released a day before the start of what is expected to be a contentious U.S. central bank policy meeting. The Fed is forecast to lower its policy rate by a quarter of a percentage point to the 3.50%-3.75% range on Wednesday, in an effort to buttress a job market that's shown signs of weakness.
The expected rate cut is likely to generate a considerable amount of formal opposition among policymakers because inflation pressures still remain well above the Fed's 2% target. Many Fed officials continue to believe getting price pressures down should be the main focus of monetary policy right now.
The New York Fed's report showed mostly benign readings on the inflation front in November. The expectations for inflation a year from now held steady at 3.2% compared to the prior month, and were unchanged at 3% for the three- and five-year-ahead projections.
Home price expectations in November were also steady at a 3% rise, amid modest changes in the outlook for a range of commodity prices. But the November year-ahead expectation of medical costs showed a 10.1% increase, the highest reading since January 2014.
The report also said future earnings and income growth remained positive in November relative to the prior month.
(Reporting by Michael S. Derby; Editing by Paul Simao)
