European consumers' inflation expectations decline in Dec 2023: ECB

However, the survey also highlighted a slight uptick in the median inflation expectations for three years ahead, which edged up to 2.5 per cent from 2.4 per cent. Despite these fluctuations, uncertainty regarding inflation expectations for the next year has remained steady.

The survey revealed a consistent pattern across different income groups, with inflation perceptions and expectations being somewhat higher among the lower income quintiles. Age also played a role in these perceptions, with younger respondents (aged 18-34) generally reporting lower inflation perceptions and expectations compared to older groups (aged 35-54 and 55-70).

On the income and consumption front, the survey found that consumer expectations for nominal income growth have held steady at 1.2 per cent. Meanwhile, perceptions of nominal spending growth over the past year have slightly decreased to 6.8 per cent from 6.9 per cent in November. Expectations for nominal spending growth over the next year remain unchanged at 3.6 per cent.

Regarding the labour market and economic growth, expectations for economic growth over the next 12 months have stayed constant at minus 1.3 per cent. Conversely, expectations for the unemployment rate 12 months ahead have seen a minor decline, dropping to 11.2 per cent from 11.4 per cent in November.

Fibre2Fashion News Desk (DP)