Americans are turning pessimistic about their personal financial outlook over the coming year, as interest rates increase and pay raises slow down.
Less than one-third of respondents to a monthly survey conducted by Fannie Mae said they expect their personal financial situation to get better over the next year, the lowest reading in a series that goes back more than a decade.
The decline in sentiment comes as the Federal Reserve signals it will extend a campaign of rate increases, which is pressuring the housing market. The Fannie Mae survey had some bad news for both owners and renters: it found that respondents expect a drop in home prices for the seventh straight month, while rents are seen rising 7.6% in the coming year, the the most since July.
Even though US labor markets have been strong, the survey also found an increase in concerns about job security.
The share of employed respondents who said they’re concerned about losing their job rose to 24%, the highest in more than two years. That matches analyst expectations that unemployment, currently at a half-century low of 3.4%, will climb by more than 1 percentage point over the coming year as the economy slows.
This article was provided by Bloomberg News.