Americans view the economic climate as getting harder, with an increasing count thinking they’ll be rejected if they apply for a credit card, mortgage or car loan, the New York Federal Reserve said Monday.
The share of respondents that expect it to be harder to obtain credit a year from now jumped to 46.7% in February, the highest since June 2024, according to a survey by the New York Fed’s Survey of Consumer Expectations (SCE).
The share of discouraged borrowers — those who reported needing credit but not applying for fear of being denied — reached 8.5% in February, the highest percentage since the start of the SCE’s survey in October 2013.
The average perceived probability of getting rejected for an auto loan climbed to 33.5%, the highest level since the monthly survey series began, the NY Fed said.
The portion of respondents that said they could come up with $2,000 if an unexpected need arose within the next month fell to 62.7%, a new series low, according to the findings.
The data release comes days after the University of Michigan reported U.S. consumer sentiment plummeted in March to a more than two-year low, with economists citing uncertainty about President Trump’s economic policies.
“Cracks are forming in the economy’s foundation: Layoffs are creeping higher, hiring is slowing, consumer sentiment has deteriorated markedly, and inflation expectations are moving higher,” Lydia Boussour, senior economist at EY Parthenon, stated. “Recession risks are rising.”
While inflation abated slightly in February, more Americans are expressing concerns about the economic impact of President Trump’s ongoing trade wars. Tariffs are import taxes paid by companies such as Walmart and Target that are often passed onto consumers through higher prices.
Those worries helped propel the U.S. stock market early last week into a correction, or plunge of 10% or more from recent highs. But that rout is continuing to be reversed at least in part, with Wall Street on Monday rising for a second consecutive session.
The financial distress that many Americans are feeling was also illustrated by disappointing retail sales across the U.S. in February, rising just 0.2% after a number of major retailers warned of a slowdown in spending.
Dollar General issued a particularly heart-rendering SOS last week, with the discount retailer’s CEO telling Wall Street analysts that some of its shoppers could no longer afford basic necessities.
Kate Gibson is a reporter for CBS MoneyWatch in New York, where she covers business and consumer finance.
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