Euro Zone Consumers Cut Inflation Expectations in June – ECB Survey Shows Decline
By Aboki Forex —
Euro zone consumers lowered their inflation expectations in June, according to the European Central Bank’s Consumer Expectations Survey. The median expectation for inflation over the next 12 months dropped to 3.0 percent in June from 3.5 percent in May.
Improvement Linked to Lower Energy Prices
The ECB survey attributed the improvement to lower energy prices after a temporary truce in the Middle East. This decline in near-term inflation expectations marks a significant shift from the previous month’s reading.
Consumers’ expectations for inflation three years ahead also fell, easing to 2.8 percent from 2.9 percent in May. The three-year figure remains above the ECB’s 2 percent target but shows continued moderation.
Longer-Term Expectations Hold Steady
Inflation expectations five years ahead remained unchanged at 2.4 percent. The ECB noted that this suggests longer-term inflation expectations continue to be relatively well anchored.
The survey covers consumers across the euro zone and is closely watched by policymakers. The ECB uses such data to gauge whether households expect inflation to remain high or return to target over the medium term.