Euro Area Inflation Expectations Fall for 2nd Month in February

2026-03-27 09:19 By Joana Taborda 1 min. read

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%).



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Euro Area Inflation Expectations Fall for 2nd Month in February
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%).
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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).
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