ECB’s Consumer Expectations Survey for March showed that consumers are raising their inflation views in a relatively measured manner rather than in a panic. Overall, the results present a slight inflationary concern on one side, but still subdued growth prospects on the other. Median expectations for inflation over the next 12 months rose by 0.3% to 2.9%, the highest level since April 2024.

Looking further ahead, expectations for inflation three years out edged up by 0.1% to 2.5%, also hitting a one-year high. Newly introduced five-year inflation expectations remained stable at 2.1%, suggesting longer-term expectations remain relatively anchored. Uncertainty about the inflation outlook remained at its lowest level since January 2022.

On the broader economic front, the survey indicated that consumers’ income growth expectations stayed unchanged at a modest 1.0% over the next year, while expected nominal spending growth edged down to 3.4%. Economic growth expectations remained weak, steady at -1.2% for the next 12 months. Full ECB Consumer Expectation Survey results here.