ECB Consumer Expectations Survey results – May 2024

28 June 2024

Compared with April 2024:

• median consumer inflation perceptions over the previous 12 months and inflation expectations for the next 12 months and for three years ahead all edged down further;
• expectations for nominal income and spending growth over the next 12 months declined;
• expectations for economic growth over the next 12 months remained unchanged, while the expected unemployment rate in 12 months’ time decreased;
• expectations for growth in the price of homes over the next 12 months remained unchanged, while expectations for mortgage interest rates 12 months ahead edged down.

Inflation

The median rate of perceived inflation over the previous 12 months edged down slightly in May to 4.9%, from 5.0% in April. Meanwhile, median expectations for inflation over the next 12 months edged down further to 2.8%, from 2.9% in April. They are now at their lowest level since September 2021. Median expectations for inflation three years ahead also edged down further to 2.3%, from 2.4% in April. Inflation expectations at the one-year and three-year horizons remained below the perceived past inflation rate. Uncertainty about inflation expectations over the next 12 months decreased to its lowest level since February 2022, when Russia invaded Ukraine. Inflation perceptions and expectations remained relatively closely aligned across income groups. Younger respondents (aged 18-34) continued to report lower inflation expectations than older respondents (those aged 35-54 and those aged 55-70). (Inflation results)

Income and consumption

Consumer expectations for nominal income growth decreased slightly to 1.2%, from 1.3% in April. Perceptions of nominal spending growth over the previous 12 months decreased to 5.9%, from 6.3% in April. Expectations for nominal spending growth over the next 12 months declined to 3.3%, from 3.6% in April. Spending expectations remained closely aligned across all income groups. (Income and consumption results)

Economic growth and labour market

Economic growth expectations for the next 12 months remained unchanged at -0.8%. Meanwhile, expectations for the unemployment rate 12 months ahead decreased to 10.7%, from 10.9% in April. 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 labour market. The lowest income quintile continued to report the highest expected and perceived unemployment rate, as well as the lowest economic growth expectations. (Economic growth and labour market results)

Housing and credit access

Consumers expected the price of their home to increase by 2.6% over the next 12 months, which was unchanged from April. Households in the lowest income quintile continued to expect higher growth in house prices than those in the top income quintile (3.3% and 2.0% respectively). Expectations for mortgage interest rates 12 months ahead edged down to 4.9%, from 5.0% in April. As in previous months, the lowest income households expected the highest mortgage interest rates 12 months ahead. The net percentage of households reporting a tightening (relative to those reporting an easing) in the access to credit over the previous 12 months saw a further decline, as did the net percentage of those expecting a tightening over the next 12 months. Both indicators reached levels last seen in the second quarter of 2022. (Housing and credit access results)

The release of the CES results for June is scheduled for 26 July 2024.

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Notes

• Unless otherwise indicated, the statistics presented in this press release refer to the 2% winsorised mean. For further details, see the ECB Consumer Expectations Survey – Aggregate statistics guide published on the CES web page.
• The CES is a monthly online survey of, currently, around 19,000 adult consumers (i.e. aged 18 or over) from 11 euro area countries: Belgium, Germany, Ireland, Greece, Spain, France, Italy, the Netherlands, Austria, Portugal and Finland. The main aggregate results of the CES are published on the ECB’s website every month. The results are used for policy analysis and complement other data sources used by the ECB.
• Further information about the survey and the data collected is available on the CES web page. Detailed information can also be found in the following two publications: Bańkowska et al., “ECB Consumer Expectations Survey: an overview and first evaluation”, Occasional Paper 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 ECB’s decision-making bodies or staff.