Eurozone Consumers' Inflation Expectations Show Slight Increase

Forex - Euro Area Consumers' Inflation Expectations Slightly Increased

According to the European Central Bank's (ECB) monthly Consumer Expectations Survey, inflation expectations for the Euro Area showed a slight increase in October for the upcoming year, while remaining unchanged for three years ahead.

The survey, conducted with approximately 19,000 adults across the 11 Euro Area countries, targets a price increase of 2%. The median inflation expectation for the next 12 months rose from 2.4% to 2.5%, while expectations for three years ahead remained steady at 2.1%.

Consumer expectations have been steadily declining for years in parallel with the slowdown in overall price increases, indicating that consumers largely believe in the ECB's assertion that victory over runaway inflation is near.

However, the ECB also noted that consumers have become more pessimistic about growth, with expectations for the next 12 months declining from -0.9% in September to -1.1%. The survey further showed that expectations for nominal income growth have also fallen from 1.3% to 1.1% in line with this rising pessimism.