Americans expect to tighten purse strings: NY Fed survey

10/08/2015 - 16:07

NEW YORK (Reuters) - Americans expected to tighten their purse strings last month, according to a Federal Reserve Bank of New York survey that also found home and gasoline prices were expected to weaken.

The New York Fed's survey of consumer expectations, released on Monday, found median one- and three-year ahead inflation expectations remained stable at 3 percent.

But over the coming year, household spending growth expectations plunged to 3.5 percent in July, from 4.3 percent the previous month, hitting the lowest since the survey began in mid-2013 thanks in part to respondents over 40-years old and those with lower levels of education.

Home price inflation expectations logged the survey's second-lowest level at 3.2 percent, from 3.5 percent, while year-ahead gas price inflation predictions slumped to 4.4 percent, from 5.4 percent.

The survey taps about 1,200 respondents on a 12-month rotating basis.

(Reporting by Jonathan Spicer; Editing by Bernadette Baum)