Results of the ECB consumer expectations survey – March 2024

April 26, 2024

Compared to February 2024:

• median consumer perceptions of inflation over the previous 12 months and inflation expectations for the next 12 months decreased, while three-year inflation expectations remained unchanged;
• nominal income and nominal spending growth expectations over the next 12 months decreased slightly;
• expectations for economic growth over the next 12 months remained unchanged, while the expected unemployment rate within 12 months decreased;
• Expectations for home price growth over the next 12 months remained unchanged, while expectations for 12-month mortgage interest rates ahead declined marginally.

Inflation

The median inflation rate perceived during the previous 12 months decreased again, for the sixth consecutive month, to 5.0%, from 5.5% in February. Median inflation expectations for the next 12 months also decreased, from 3.1% to 3.0%. They are now at their lowest level since December 2021. Three-year median inflation expectations remained unchanged at 2.5% for the fourth consecutive month. One- and three-year inflation expectations remained well below the perceived past inflation rate. Uncertainty about inflation expectations over the next 12 months decreased slightly and is now at its lowest level since the start of Russia’s unjustified war against Ukraine in February 2022. The evolution of inflation perceptions and expectations remained unchanged relatively closely aligned across income groups, although somewhat higher for the lowest two income quintiles. Younger respondents (ages 18 to 34) continued to report lower inflation perceptions and expectations than older respondents (ages 35 to 54 and 55 to 70). (Inflation results)

Income and consumption

Consumer expectations for nominal income growth decreased slightly to 1.3%, from 1.4% in February. This decrease was observed in all age groups. Perceptions of nominal spending growth over the previous 12 months remained stable at 6.4%. Expectations for nominal spending growth over the next 12 months decreased slightly to 3.6%, from 3.7% in February. This decrease was only observed in the top three income quintiles. (Income and consumption results)

Labor market and economic growth

Economic growth expectations for the next 12 months remained unchanged at -1.1%. In contrast, expectations for the 12-month forward unemployment rate decreased to 10.7%, from 10.9% in February. Consumers continued to expect the future unemployment rate to be only slightly higher than the perceived current unemployment rate (10.4%), implying a broadly stable labor market. The lowest income quintile continued to have the highest expected and perceived unemployment rate. (Labor market and economic growth results)

Access to housing and credit

Consumers expected their home prices to rise 2.4% over the next 12 months, unchanged from February. Households in the lowest income quintile continued to expect greater house price growth than those in the highest income quintile (3.2% and 2.0%, respectively). Expectations for 12-month mortgage rates decreased slightly to 5.0%, from 5.1% in February. As in previous months, lower-income households expected the highest mortgage interest rates 12 months from now. The net percentage of households reporting a tightening (relative to those reporting an easing) in access to credit over the previous 12 months continued to decline, as did the net percentage of those expecting a tightening over the 12 months. following. (Results of access to housing and credit)

The publication of the April CES results is scheduled for May 28, 2024.

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Grades

• Unless otherwise stated, statistics provided in this press release refer to the 2% winsorised average. For more details, see the ECB Consumer Expectations Survey – Aggregate Statistics Guide published on the CES website.
• The CES is a monthly online survey currently conducted among around 19,000 adult consumers (i.e. aged 18 and over) in 11 euro area countries: Belgium, Germany, Ireland, Greece, Spain, France, Italy, Netherlands , Austria, Portugal and Finland. . The main aggregate results of the CES are published monthly on the ECB website. The results are used for policy analysis and complement other data sources used by the ECB.
• More information about the survey and the data collected is available on the CES website. Detailed information can also be found in the following two publications: Bańkowska et al., “ECB Consumer Expectations Survey: an Overview and first EVALUATION”, Occasional Article Series, No. 287, ECB, Frankfurt am Main, December 2021; and Georgarakos, D. and Kenny, G., “Household spending and fiscal support during the COVID-19 pandemic: Insights from a new consumer survey,” Journal of monetary economics, vol. 129, Supplement, July 2022, pp. S1-S14.
• The survey results do not represent the views of the governing bodies or staff of the ECB.