Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
Home News Euro zone consumers see lower inflation ahead – ECB poll
2023 07 05T090427Z 1 LYNXMPEJ640A1 RTROPTP 4 HEALTH CORONAVIRUS GERMANY

Euro zone consumers see lower inflation ahead – ECB poll

by Uma Rajagopal
0 comments

Euro zone consumers see lower inflation ahead – ECB poll

FRANKFURT (Reuters) -Euro zone consumers in May cut their inflation expectations again for the following 12 months, although they still saw prices growing faster than the European Central Bank (ECB) would like for years to come, a new ECB poll showed on Wednesday.

The ECB’s monthly Consumer Expectations Survey, which also showed modest expectations for income growth, was likely to provide some relief to policymakers deploying relentless interest rate hikes to battle a bout of high inflation in the 20 countries that share the euro.

The median respondent in the May edition of the survey expected prices to grow by 3.9% in the following 12 months, down from 4.1% in April and 5.0% in March, likely reflecting in part lower realised inflation.

Uncertainty about inflation expectations 12 months ahead, as measured by the dispersion in responses, fell to its lowest level since March 2022, straight after the start of Russia’s war in Ukraine.

But consumers expected inflation three years ahead to come in at 2.5%, unchanged from April and still above the ECB’s 2% target.

Speaking shortly before the survey was released, ECB policymaker Joachim Nagel said it was key to keep inflation expectations well-anchored but he was wary of calling a new era of high interest rates.

The ECB has raised rates by an unprecedented 4 percentage points in the past year and pencilled in a ninth straight rate hike in July, with a further increase eyed in September too.

The poll also showed consumers expected their nominal income growth at 1.2% to undershoot inflation in the coming 12 months, while spending was seen rising 6.8%.

This implied lower saving or more borrowing, and should dampen worries about a possible spiral between wages and prices.

(Reporting By Francesco Canepa; Editing by Devika Syamnath)

 

Recent Post
Illustration of a woman with long black hair and wearing white round earrings. She is smiling and dressed in a red top, set against a light pink background.

Uma Rajagopal has been managing the posting of content for multiple platforms since 2021, including Global Banking & Finance Review, Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune. Her role ensures that content is published accurately and efficiently across these diverse publications.