NY Fed SCE April: 1yr ahead expected inflation 3.6% (prev. 3.4%), 3yr unchanged at 3.1%, 5yr unchanged at 3.0%
- Median year-ahead gas price growth expectations dropped sharply to 5.1% (prev. 9.4%) from a spike in March.
- Median one-year-ahead earnings growth expectations eased to 2.7% (prev. 3.0%).
- However, mean unemployment expectations—or the mean probability that the US unemployment rate will be higher one year from now—increased by 0.4 ppt to 43.9%, the highest reading of the series since April 2025.
Context
The NY Fed's SCE data shows a slight increase in one-year expected inflation to 3.6%, which could signal a potential shift in monetary policy focus. Most notably, the drop in gas price expectations and rise in unemployment probabilities suggest mixed signals for growth and inflation, possibly prompting the Fed to adopt a cautious stance on future rate hikes.
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