The median consumer inflation perceptions over the previous 12 months decreased further for the fourth consecutive month to 6 per cent in January from 6.9 per cent in December, according to the European Central Bank’s (ECB) consumer expectations survey conducted in January.

Inflation expectations for the next 12 months edged up by 0.1 percentage points to 3.3 per cent and remained unchanged at 2.5 per cent for three years ahead.

Inflation expectations at the one-year and three-year horizons remained well below the perceived past inflation rate. Uncertainty about inflation expectations over the next 12 months remained unchanged.

Expectations for economic growth over the next 12 months became less negative, standing at minus 1.1 per cent, while the expected unemployment rate in 12 months decreased to 10.9 per cent in January from 11.2 per cent in December.

Consumers continued to expect the future unemployment rate to be slightly higher than the perceived current unemployment rate (10.6 per cent), implying a broadly stable labour market.

However, quarterly data show that unemployed respondents reported an increase in their expected probability of finding a job over the next three months, which rose to 30.5 per cent in January this year from 27.6 per cent in October 2023.

Expectations for nominal income growth over the next 12 months remained stable, while expectations for nominal spending growth increased marginally.

Fibre2Fashion News Desk (DS)

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