NEW YORK (Reuters) - U.S. inflation expectations rose in December to the highest level in months as younger and middle-age workers expected higher prices and earnings, according to a Federal Reserve Bank of New York survey published on Tuesday.
The survey of consumer expectations, which the Fed considers among other data as it continues to gradually raise interest rates, showed median one-year ahead expectations jumped to 2.82 percent last month, from 2.61 percent in November, the highest reading since February.
The three-year inflation measure was 2.89 percent, up from 2.78 percent in the previous month, reaching its highest point since April. On both counts the New York Fed said the increase was largely driven by survey respondents younger than 40.
The increases make up some ground after years in which these inflation measures, taken since mid-2013, have generally slipped. The U.S. central bank hiked rates three times last year and aims to do the same in 2018, even while inflation remains below target.
Survey respondents were more optimistic about earnings growth. Median one-year ahead expectations were 2.7 percent, up from 2.6 percent in November. It was the highest level since 2014 thanks to respondents primarily between 40 and 60 years old and those earning between $50,000 and $100,000 annually, the New York Fed said.
The internet-based survey is done by a third party and taps a rotating panel of about 1,200 household heads.
Reporting by Jonathan SpicerEditing by Chizu Nomiyama