US Consumers Report Rising Debt Worries

Recent surveys by the New York Federal Reserve reveal that consumer worries about missing debt payments have reached their highest levels since April 2020, with more than 14% anticipating possible delinquencies in the next three months. This trend is most pronounced among middle-aged respondents and those earning above $100,000. Despite these concerns, consumer spending continues to defy expectations, with retail sales performing above forecasts. Inflation expectations have also been adjusted, with long-term projections rising slightly, although short-term inflation remains steady at 3%. Meanwhile, the Federal Reserve is considering further rate cuts to manage inflation and economic risks, although robust job market data complicates this outlook. The overall economic environment is characterized by elevated inflation, rising borrowing costs, and persistent consumer spending.