Fed survey: Consumers expect better credit, higher health bills
A new monthly survey released by the Fed shows consumer expectations for medical costs increased slightly in the last two months of the year while their views of credit availability improved in December.
The Federal Reserve Bank of New York released its new survey of consumer expectations, which captures the views of Americans on everything from inflation to job security and prospects to household finances.
Perceptions about access to credit and future credit improved slightly, reversing a modest decline in September to November. For instance, 17.9 percent believed credit access would be easier in a year, up from 14.5 percent in November, and 10.4 percent expected credit to be more difficult, down from 12.2 percent in November.
The Demand Institute, a nonprofit operated by the Conference Board and Nielsen, conducted the survey of 1,200 household heads over the past six months.
Home price expectations were 3.9 percent in December, slightly below the 4.5 percent or better expected in four of the last six months. This slight decline came during a period when mortgage rates had been rising.
Consumers in the survey expected a median rate of inflation of 3.1 percent in the year ahead, but when the Fed presented individual expenditures, like rent, medical costs and food expenses, their views varied. Food, for instance, was basically flat, with an expectation over the six-month period that food costs would go up 5.1 to 5.3 percent in the next 12 months.
Gasoline fluctuated more, with expectations in December at the lower end of a recent range.
But medical care cost expectations rose during the last two months, with the medical costs expected to climb over the next 12 months by 11.2 percent in December. That was slightly above the 10.7 percent in November and slightly above the six-month trend.
Fed economists, in a conference call with reporters, said the reasons behind a slight pick up in expectations for medical costs could not be determined by the survey. They also said, in response to a question, that it could not be tied directly to the Affordable Care Act, which was much in the headlines at year-end as consumers made insurance choices under the health-care act.
Consumers in the survey also saw a 22 percent mean probability of leaving a job by choice over the next year, while 17 percent saw a probability of losing a job. They also saw a 46 percent probability of finding a new job in the next three months if they did lose a job.
—By CNBC's Patti Domm. Follow her on Twitter @pattidomm.