Euro Area Consumer Inflation Expectations Unchanged in April

Eurozone median inflation expectations for the next 12 months were steady at 4% in April 2026, the same as in March and staying at 2023-highs. Consumers expected the price of their home to increase by 3.7% over the next 12 months, which was unchanged from March and expectations for mortgage interest rates also remained unchanged. In addition, expectations for inflation three years ahead decreased to 2.9% from 3% and inflation expectations for five years ahead remained unchanged at 2.4%. Meanwhile, economic growth expectations for the next 12 months became more negative, decreasing to -2.2% from -2.1%. By contrast, expectations for the unemployment rate 12 months ahead decreased to 11.2% from 11.3% in March. In addition, consumers’ nominal income growth expectations over the next 12 months decreased to 0.8% in April from 1.2% in March.

Eurozone median inflation expectations for the next 12 months jumped to 4.0% in March 2026, the highest level since October 2023 and up sharply from 2.5% in February. This marked the largest monthly increase since early 2022, when Russia’s invasion of Ukraine disrupted energy markets. The escalating Iran war and the blockade of the Strait of Hormuz have led to a surge in energy prices and internsifed fears of broader inflationary pressures. Longer-term expectations also rose, with three-year inflation forecasts climbing to 3.0% in March from 2.5% in February, and five-year expectations edging up to 2.4% from 2.3%. Uncertainty over short-term inflation grew, though the upward trend in expectations was consistent across income groups. Lower-income respondents reported slightly higher near-term expectations, while younger respondents (18-34) continued to anticipate lower inflation than older age groups.

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%).