Confidence in finances drops sharply for Americans in survey

Americans' confidence in their personal financial outlook is at its lowest since 2010 due to pressure from high inflation and rising interest rates, according to a FOX Business report.

According to a new survey from Fannie Mae, only 31 percent of Americans expected their personal financial situation to improve in the coming year, the lowest level since the survey began in 2010.

Additionally, just 28 percent of respondents believed the US economy was on the right track.

"The decline in sentiment comes as the Federal Reserve signals that interest rates may need to climb higher than previously projected as a result of underlying inflationary pressures within the economy," read the report, published last week.

Interest rate hikes often lead to higher consumer and business loan rates, which slows the economy by forcing employers to cut back on spending. They can also put pressure on consumers in areas such as credit card fees and auto loans.

In addition, persistently high inflation is putting serious financial pressure on most American households, as they are forced to pay more for everyday expenses such as food and rent, with low-income Americans bearing the brunt of these costs disproportionately.

According to a report released by the US Department of Labor in February, the consumer price index rose 0.5 percent in January, the largest increase in three months.

The survey also revealed US workers are becoming increasingly concerned about job security, with 24 percent of respondents worried about losing their job, the highest level in more than two years.

Federal Reserve officials have made it clear the unemployment rate is expected to rise as interest rates increase. Some officials predict more than 1 million Americans could lose their jobs between now and the end of 2023.