Inflation Expectations Dip

In a recent update from the European Central Bank (ECB), the January 2025 Consumer Expectations Survey revealed a decrease in inflation expectations for the upcoming year. The figures have adjusted to 2.6%, a slight decline from the 2.8% recorded in December 2024.

Stable Long-Term Outlook

Despite the short-term fluctuations, the three-year ahead inflation expectations have remained steady at 2.4%. The ECB highlighted that these expectations continue to fall below the perceived past inflation rate, indicating a stable yet cautious economic outlook.

Economic Growth and Unemployment

On a brighter note, consumer expectations for economic growth over the next 12 months have shown improvement, moving from negative 1.3% in December 2024 to negative 1.1% in January. Additionally, the anticipated unemployment rate for the next year has slightly decreased from 10.5% to 10.4%, suggesting a gradual recovery in the job market.