In July, consumers grew more optimistic about future inflation, according to a New York Federal Reserve report.

The three-year inflation outlook dropped to a record low of 2.3%, though consumers still expect inflation to remain elevated in the short term.

This report comes as investors anticipate potential interest rate cuts by the Federal Reserve.

While inflation expectations for gas and food prices decreased slightly, concerns rose for costs related to medical care, college education, and rent, CNBC has reported.

Despite rising unemployment, job confidence improved, with fewer people fearing job loss and more expecting to leave jobs voluntarily.

Written by B.C. Begley