10 Some of these questions ask respondents to assign probabilities to various ranges of outcome – so-called density forecasts.11 Generally, people across a wide range of countries and walks of life appear to be able to answer probabilistic questions, and their expectations are found to be useful in forming predictions of future economic outcomes. The survey of consumer expectations Turning now to the development and use of expectations surveys at the New York Fed, let me first discuss our Survey of Consumer Expectations (SCE). Over the last ten years, we extensively tested and eventually implemented a new survey of households, with the goal of collecting timely and accurate information at high frequency on U.S. consumers’ expectations and decisions on a broad variety of topics. The SCE, launched in June 2013, was designed to fill gaps in existing data collections about consumer expectations and outcomes, to provide a more integrated data approach, and to take advantage of state-of-the-art survey techniques. The SCE is implemented as a monthly, nationally representative survey of about 1,300 household heads.12 Recently the Bank of Canada implemented its own version of the SCE, fielded at a quarterly frequency. The SCE has various components, which are outlined on Slide 2. First, respondents are asked a core monthly module of questions concerning their expectations about various macroeconomic and household-level variables. These questions cover inflation expectations and expectations regarding changes in home prices and the prices of various specific goods and services, such as gasoline, food, rent, medical care, and a college education.

Brodsky, Bonni, Marco Del Negro, Joseph Fiorica, Eric LeSueur, Ari Morse, and Anthony Rodrigues. 2016a. “How Do Survey- and Market-Based Expectations of the Policy Rate Differ?” Federal Reserve Bank of New York Liberty Street Economics (blog), April 7. Brodsky, Bonni, Marco Del Negro, Joseph Fiorica, Eric LeSueur, Ari Morse, and Anthony Rodrigues. 2016b. “Reconciling Survey- and Market-Based Expectations for the Policy Rate.” Federal Reserve Bank of New York Liberty Street Economics (blog), April 8. Bruine de Bruin, Wändi, Wilbert van der Klaauw, and Giorgio Topa. 2011a. “Expectations of Inflation: The Biasing Effect of Thoughts about Specific Prices.” Journal of Economic Psychology 32, no. 5 (October): 834–45. Bruine de Bruin, Wändi, Charles F. Manski, Giorgio Topa, and Wilbert van der Klaauw. 2011b. “Measuring Consumer Uncertainty about Future Inflation.”Journal of Applied Econometrics 26, no. 3 (April–May): 454–78. Bruine de Bruin, Wändi, Wilbert van der Klaauw, Maarten van Rooij, Federica Teppa, Klaas de Vos. 2016. “Measuring Expectations of Inflation: Effects of Survey Mode, Wording, and Opportunities to Revise.” De Nederlandsche Bank working paper no. 506. Bruine de Bruin, Wändi, Wilbert van der Klaauw, Giorgio Topa, Julie S. Downs, Baruch Fischhoff, and Olivier Armantier. 2012. “The Effect of Question Wording on Consumers’ Reported Inflation Expectations.” Journal of Economic Psychology 33, no. 4: 749–57. Carroll, Christopher. 2003. “Macroeconomic Expectations of Households and Professional Forecasters.” Quarterly Journal of Economics 118, no. 1: 269–98. BIS central bankers’ speeches  17  Correia-Golay, Ellen, Steven Friedman, and Michael McMorrow. 2013.