Consumers see inflation—and spending—cooling off in the year ahead, New York Fed survey shows

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The one-year inflation outlook declined to 5%, the lowest level since July 2021, according to a recent New York Fed survey.

The one-year inflation outlook declined to 5%, the lowest level since July 2021, according to a New York Fed survey released Monday.

Consumers expect gas prices to increase 4.1% and food prices to rise 7.6% over the next year, in both cases a 0.7 percentage point decline from the previous month The central bank district's monthly Survey of Consumer Expectations for December showed that the one-year inflation outlook declined to 5%, down 0.2 percentage pointWhile that pace would still be well above the Fed's goal of 2% annual inflation, it represents progress in the fight against the surging cost of living.

Over the longer term, expectations were little changed, with the three-year outlook holding at 3% and the five-year projection edging higher to 2.4%.

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