Euro zone consumers take benign view on inflation surge, ECB survey shows
Euro zone consumers take benign view on inflation surge, ECB survey shows
ReutersMon, June 1, 2026 at 8:09 AM UTC
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1 / 0People shop at a local market in NantesPeople shop at a local market in Nantes, France, April 3, 2026. REUTERS/Stephane Mahe
FRANKFURT, June 1 (Reuters) - Euro zone consumers kept steady or lowered their inflation expectations in April, a hopeful sign for policymakers that crucial medium-term price bets are not signalling any oversized shift away from the target, an ECB survey showed on Monday.
Inflation soared to 3% in April on higher oil prices, well above the ECB's 2% target, and some policymakers had expressed concern that household views are starting to move too far away from target, potentially signalling an unanchoring of policy-relevant expectations.
However, the April edition of the ECB's monthly consumer survey showed a more benign trend, as expectations one year ahead held steady at 4.0% while for three years out, they eased to 2.9% from 3.0%.
The survey, an important input into policy deliberations at the June 11 meeting, also showed expectations five years ahead unchanged at 2.4%.
"Respondents in lower-income quintiles continued to report on average slightly higher inflation perceptions and expectations," the ECB said. "Younger respondents continued to report lower inflation perceptions and expectations than older respondents."
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The survey is unlikely to move market expectations for the near term as policymakers have extensively telegraphed a 25-basis-point hike in the bank's 2% deposit rate in June.
But the data may temper bets for follow-up moves as they suggest no need for rapid policy tightening like in 2022, when prices ran away, eventually hitting double-digit territory.
This is partly because expectations for economic growth became more negative, the survey showed, with consumers anticipating a 2.2% economic contraction in the year ahead and they also curbed their income growth bets to 0.8% from 1.2%.
Fresh euro zone inflation data is due on Tuesday and economists polled by Reuters see the rate rising to 3.2%. Price growth could keep accelerating in the coming months and may peak closer to 4%.
(Reporting by Balazs Koranyi; Editing by Alexandra Hudson)
Source: “AOL Breaking”
