Eurozone Inflation Expectations Fall to 6-Month Low

Eurozone median inflation expectations for the next 12 months decreased for a second consecutive month to 2.5% in February 2026, the lowest since October 2024, from 2.6% in January. Expectations for inflation three years ahead also went down to 2.5% from 2.6% while expectations for five years ahead remained unchanged at 2.3%. Uncertainty about inflation expectations over the next 12 months remained unchanged. Meanwhile, expectations for growth in the price of homes over the next 12 months declined to 3.6% from 3.7%, while expectations for mortgage interest rates in 12 months’ time remained unchanged at 4.7%. Elsewhere, expectations for nominal income growth over the next 12 months remained unchanged at 1.2%, while expectations for spending growth rose to 3.5% from 3.4%. Expectations for economic growth became less negative (-0.9% vs -1.1%), while the expected unemployment rate decreased (10.8% vs 11%).

Eurozone median inflation expectations for the next 12 months decreased to 2.6% in January 2026, the lowest in six months, from 2.8% in December. Expectations for inflation three years ahead were unchanged at 2.6%, while inflation expectations for five years ahead decreased to 2.3%, from 2.4%. Uncertainty about inflation expectations over the next 12 months remained unchanged in January. Respondents in lower income quintiles continued to report on average slightly higher inflation perceptions and short-horizon expectations than those in higher income quintiles, a trend observed since 2023. However, the broad evolution of inflation perceptions and expectations remained closely aligned across income groups. Younger respondents (aged 18-34) continued to report lower inflation perceptions and expectations than older respondents (aged 35-54 and 55-70).

Eurozone median inflation expectations for the next 12 months were unchanged at 2.8% in December 2025. By contrast, expectations over longer horizons edged higher: three-year-ahead inflation expectations rose to 2.6% from 2.5%, while five-year-ahead expectations increased to 2.4% from 2.2%. Uncertainty around inflation expectations for the next 12 months also remained unchanged in December. Respondents in the lowest income quintiles continued to report slightly higher inflation perceptions and short-term expectations than those in higher income groups, consistent with a trend observed since 2023. Despite this gap, inflation perceptions and expectations evolved in broadly similar ways across income categories. Younger respondents (18–34) continued to report lower inflation perceptions and expectations than older groups (35–54 and 55–70).