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Prices Expected to Rise Two Times Higher Than Wages: Fed Survey According to data from the Bureau of Labor Statistics, the Consumer Price Index increased 6.8 percent in the 12 months through November, the fastest climb in 39 years.

By The Epoch Times

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U.S. consumers expect short-term inflation to go up along with a drop in future earnings in November, implying a worsening economic outlook with higher prices surpassing any growth in wages, according to a New York Federal Reserve survey released on Monday.

The Survey of Consumer Expectations, taken from a pool of 1,300 household heads, show median one-year-ahead inflation expectations rise from 5.7 in October to 6.0 percent, while uncertainty regarding short- and medium-term inflation reach new series high. Meanwhile, expectations regarding one-year-ahead earnings growth went down by 0.2 percentage points to 2.8 percent. The decline was highest among low income households (below $50,000).

According to data from the Bureau of Labor Statistics (BLS), the Consumer Price Index (CPI) increased 6.8 percent in the 12 months through November, the fastest climb in 39 years. This is the sixth straight month of above-five-percent inflation that persists to torment the average American consumer.

Expectations regarding changes in home prices went down slightly from 5.6 to 5.0 percent, but still remains significantly higher than the pre-pandemic 3.1 percent. While respondents expect rents to remain the same, there is an anticipation that gas prices will go down. Food prices are touted to go up (0.1 percent) along with medical care costs (9.6 percent).

As for the labor market, job openings have rebounded to a near-record high and unemployment has fallen to 4.6 percent with weekly jobless claims declining to their lowest levels since 1969.

People's expectation that the unemployment levels in the country will go higher increased 0.6 percentage points to 36.1 percent. The fear of losing one's job in the next 12 months rose from 11 to 13 percent, but is still below 13.8 percent recorded in February 2020. There is also a higher chance of leaving one's job, and an increase in the possibility of remaining unemployed.

There is a 0.1 percentage point decrease in median expected growth in household income. Meanwhile, the spending expectations went up by 0.3 percent to 5.7 percent, which is a new series high, with the highest increases showing in low-income households.

The prospects of getting credit, now and in future, have decreased as well as the probability of missing on a minimum debt payment over the next three months.

"Perceptions about households' current financial situations compared to a year ago deteriorated in November, with more respondents reporting being financially worse off than they were a year ago," stated a summary report of the survey.

"Respondents were also more pessimistic about their household's financial situation in the year ahead, with fewer respondents expecting their financial situation to improve a year from now."

The current level of inflation might prompt the Fed to increase the speed of its bond tapering process, which is scheduled to be finished by June next year. This will initiate interest rates hikes, and bring about a situation to curb the increasing prices.

By Naveen Athrappully

Naveen Athrappully is a news reporter covering business and world events at The Epoch Times.

The Epoch Times, founded in 2000, is headquartered in Manhattan, New York, with a mission to provide independent and accurate information free of political bias or corporate influence. The organization was established in response to censorship within China and a lack of global awareness regarding the Chinese regime's repression of the spiritual practice Falun Gong.

The Epoch Times is a widely read newspaper that is distributed in 33 countries and is available in 21 languages. The publication has been critical in providing balanced and detailed reporting on major global events such as the 2003 SARS pandemic and the 2008 financial crisis. Notably, the organization has played a key role in exposing corruption inside China.

Aside from its human rights coverage, The Epoch Times has made significant contributions in a variety of fields. It has received praise for its in-depth analysis and expert perspectives on business, the economy and U.S. politics. The newspaper has also received praise for its broad coverage of these topics.

A series of editorials titled "Nine Commentaries on the Communist Party" appeared in The Epoch Times in 2004. It asserts that freedom and prosperity in China can only be achieved by eliminating the Communist Party, which violated China's cultural and spiritual values. In addition, the organization led the Tuidang movement, which resulted in over 400 million Chinese citizens quitting the Communist Party. In spite of this, 90% of websites referring to the "Nine Commentaries" were blocked by the Chinese regime.

The Epoch Times has been at the forefront of investigating high-level corruption cases within the Chinese regime, with its reporters taking significant risks to uncover these stories. The organization has received several awards for its investigative journalism.

The organization has received several awards for its investigative journalism. For more, visit www.theepochtimes.com.

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