Inflation Expectations Take a Dip

The European Central Bank (ECB) has released its January 2025 Consumer Expectations Survey, revealing a slight decrease in inflation expectations for the next 12 months. The figures have dropped to 2.6%, down from 2.8% recorded in the previous month's survey.

Stability in Long-Term Expectations

On the other hand, the three-year ahead inflation expectations have remained steady at 2.4%. According to the ECB, both the one-year and three-year inflation expectations continue to stay below the perceived past inflation rate. Additionally, the uncertainty surrounding inflation expectations over the next 12 months has remained unchanged for the sixth consecutive month, marking the lowest level since February 2022.

Economic Growth and Unemployment Outlook

Consumer expectations regarding economic growth for the next 12 months have seen a slight improvement, moving from negative 1.3% in December 2024 to negative 1.1% in January. Furthermore, expectations for the unemployment rate one year ahead have also declined, from 10.5% in December 2024 to 10.4% in January.