FRANKFURT, Feb 27 (Reuters) – Euro zone consumers trimmed back some of their inflation expectations last month, even as bets on income growth rose, the European Central Bank’s monthly Consumer Expectations Survey showed on Friday.
Euro zone inflation stayed around the ECB’s 2% target for most of 2025 but dipped below it last month and is likely to remain at relatively low levels all this year as energy costs have fallen and imports, particularly from China, remain cheap.
Consumers surveyed by the ECB in January saw inflation in the year ahead at 2.6%, below the 2.8% predicted in December, while price growth expectations five years out were lowered to 2.3% from 2.4%.
For three years ahead, expectations were unchanged at 2.6%, the survey of 19,000 adults in 11 euro zone countries showed.
With inflation largely tamed, the ECB has not even debated a policy change for months and, if anything, some policymakers fear that inflation will be too low in the years ahead rather than too high.
The survey showed income growth expectations rose slightly, to 1.2% from 1.1%, and economic growth expectations were unchanged, suggesting that consumers believe in the currency bloc’s continued resilience.
Overall economic growth has been better in recent quarters than many had expected as firms appear to be adjusting well to the volatility stoked by the quickly shifting nature of the Trump administration’s tariff regime in the United States.
(Reporting by Balazs KoranyiEditing by Gareth Jones)
