Fed survey reveals growing financial unease
A recent New York Federal Reserve survey shows increasing concern among Americans about their financial stability, as inflation expectations for the coming year continue to climb. According to the monthly Survey of Consumer Expectations, fewer households believe they’ll be better off financially a year from now, while expectations for spending growth have also declined.
Grocery prices weigh heavily on sentiment
The rising cost of food remains a key factor behind the economic pessimism. Grocery prices jumped 2.7% year-over-year in August, the fastest pace since 2023. Analysts note that food costs are one of the most visible and emotionally charged expenses for consumers. LendingTree’s Matt Schulz explained that rising grocery bills are deeply influencing Americans’ perception of their economic well-being.
Spending continues, but with caution
Despite inflation worries, spending has not yet slowed dramatically. A separate KPMG report predicts consumer spending will increase during the holiday season, though shoppers are becoming more selective. Duleep Rodrigo of KPMG compared consumer behavior to a poker player with limited chips—choosing carefully when to spend for maximum payoff amid emotional and economic uncertainty.
Credit card debt hits record highs
Meanwhile, rising debt levels indicate growing financial strain. The New York Fed reports that credit card balances hit $1.21 trillion in Q2 2025, a 2.3% increase from the previous quarter and on par with the all-time high from last year. This suggests that more Americans are relying on credit to cover everyday expenses, raising concerns about long-term financial stability.
