Consumer prices in the eurozone are expected to rise nearly four times stronger than nominal household incomes by the end of next winter, consumers estimate, according to a survey by the European Central Bank (ECB).
In February, consumers estimated that inflation in February next year would be 4.6 percent, which is 0.3 percentage points lower than they predicted in January.
In the next three years, it is expected to drop to 2.4 percent, according to the latest ECB survey, which is 0.1 percentage points lower than they expected at the beginning of the year.
Nominal household incomes are expected to rise by 1.2 percent by the end of February 2024, meaning that consumers now expect a 0.1 percentage point weaker growth than they predicted at the beginning of the year.
Their expectations for nominal consumption growth have slightly improved, reflected in a projected growth rate of 3.9 percent, compared to 3.8 percent predicted in January.
Economic activity in the eurozone is expected to decrease by 0.9 percent in the 12 months leading up to the end of February 2024. In January, consumers predicted a 1.2 percent decline in activity.
The unemployment rate is expected to be 11.5 percent by the end of February next year, which is largely in line with their January forecasts.
The ECB survey includes 14,000 respondents from six leading eurozone economies.
