A man walks by the Federal Reserve Bank of New York Building in New York City, U.S., April 26, 2021. REUTERS/Shannon Stapleton

By Michael S. Derby

NEW YORK (Reuters) -Americans last month said that they expected moderating near-term inflation pressures as they continued to worry about the outlook for the job market and their personal finances, a report from the Federal Reserve Bank of New York said on Friday.

In October, households said a year from now they expected inflation to come in at 3.2% from September’s 3.4% expectation, according to the bank’s latest Survey of Consumer Expectations. Three and five years from now households see inflation at 3% in both time frames, unchanged from the prior month.

Even as households moderated their near-term inflation outlook, they worried about the job market and the current and future state of their finances. Survey respondents in October expected a higher year-ahead unemployment rate compared to the prior month and saw a harder time finding a job if they were to be unemployed, although they’re less worried about losing their job compared with September.

Worries about finding future work were driven by those under the age of 60 and those who have attended some college.

The survey also found that Americans have grown more pessimistic about both their current and future financial situations, although respondents said in October that credit is now easier to get and should be easier to get in the future.

In October, expectations for future earnings and income were mixed. Households in the survey also had a mixed outlook for future commodity prices, expecting future declines in gasoline and food prices. Meanwhile, October’s expected year-ahead rise in medical costs hit the highest reading since February, 2023.

The New York Fed survey was conducted over the course of October, amid the government shutdown and rising fears about the outlook for the job market. Last week the Fed cut its interest rate target by a quarter percentage point to the 3.75%-4.00% range, as it sought to support the job market while keeping policy in a place where it can still put downward pressure on inflation that’s well above the Fed’s 2% target.

Fed officials have said one reason they remained confident inflation will eventually return to target is the relative stability of longer-term inflation expectations, which they believe exert a strong influence on where price pressures stand now.

(Reporting by Michael S. Derby; Editing by Andrea Ricci)