Results of the ECB’s consumer expectations survey – August 2022
October 7, 2022
Compared to July:
- consumer expectations of inflation after 12 months and three years remained unchanged;
- expectations of nominal income and expenditure growth over the next 12 months increased;
- expectations for economic growth rose slightly over the next 12 months and fell for unemployment after 12 months;
- Consumers expected the price of their home to rise slightly more over the next 12 months, while their expectations for mortgage rates 12 months from now continued to rise.
Inflation. Expected inflation over the previous 12 months continued to accelerate, with the median rate now at 8.0%, up from 7.9% in July. Inflation expectations remained clearly below the previous inflation rate, especially in the medium term of three years. Both the median inflation expectation over the next 12 months and the median inflation expectation over the next three years remained unchanged at 5.0 percent and 3.0 percent, respectively. Uncertainty about 12-month inflation was stable in August compared to July. Consumers’ inflation perceptions and expectations between income groups were in line. (Link to inflation results and charts)
Income and consumption. Consumers expected nominal income to grow 1.0% over the next 12 months, up from 0.8% in July. The improvement in expected nominal income growth was widespread in different income groups, with the exception of respondents in the first quintile, who expected slower nominal income growth. Views of nominal spending growth over the previous 12 months continued to rise, reaching a new high of 5.8%, up from 5.4% in July. The biggest increase came from high-income respondents. Expectations for growth in nominal spending over the next 12 months rose further to 4.5% from 4.2% in July, driven by the growth expected by low- and middle-income respondents. (Link to income and consumption results and charts)
Labor market and economic growth. Economic growth expectations for the next 12 months rose slightly from July’s -1.9 percent to -1.7 percent. With the increase in economic growth expectations, expectations regarding the unemployment rate fell to 11.9 percent after 12 months. Nevertheless, consumers still expected the unemployment rate to be higher than the current unemployment rate (11.5%). (Link to labor market and growth results and charts)
Apartment and credit facility. After the decrease in July, consumers slightly raised their expectations for the increase in the prices of their apartments in the next 12 months to 3.4 percent. Expectations for mortgage interest rates 12 months ahead rose further to 4.4 percent and are now 1.1 percentage points higher than at the beginning of 2022. Both consumers’ view of getting credit from the previous 12 months and their expectations for the next 12 months tightened slightly again. (Link to housing and credit availability results and graphs)
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Notes
- Unless otherwise noted, the statistics presented in this press release refer to a winsorized average of 2%. For more information, see section Aggregate statistics guide published on the CES website.
- CES is a monthly online survey that currently involves around 14,000 adult (i.e. at least 18) consumers from six Eurozone countries: Belgium, Germany, Spain, France, Italy and the Netherlands. The main aggregated 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.
- More information about the study and the data collected is available on the CES website. Detailed information can also be found in the following two publications: ECB (2021), “ECB Consumer Expectations Survey: an overview and first assessment”, Occasional Paper series, No. 287, Frankfurt am Main, December; and Georgarakos, D. and Kenny, G., “Household consumption and financial support during the COVID-19 pandemic: insights from a new consumer survey“, Journal of Monetary Economics, Butter. 129, Supplement, July 2022, pp. S1-S14.
- The results of the survey do not represent the views of the ECB’s decision-making bodies or staff.