The Federal Reserve Bank of New York’s July survey reveals a significant drop in medium-term inflation expectations among U.S. consumers, with the three-year outlook falling to a record low of 2.3%. While short- and long-term inflation expectations remained stable, concerns about debt repayment increased, particularly among lower-income households. This shift in consumer sentiment comes as recent inflation measures approach the Fed’s 2% target, potentially influencing the central bank’s decision on interest rate cuts.