Eurozone consumers grew slightly less pessimistic in June compared with May, but remain cautious about spending and concerned about the economic outlook, according to the European Central Bank‘s monthly consumer expectations survey published July 24.
Inflation expectations for the next 12 months fell to 3.0 percent from 3.5 percent, while three-year expectations edged down to 2.8 percent from 2.9 percent. Five-year expectations held steady at 2.4 percent. The findings align with Eurostat’s harmonized consumer price index for June, which showed eurozone inflation easing to 2.8 percent from 3.2 percent in May.
Greeks Far Gloomier Than European Peers
Greek consumers stand out as the most pessimistic in both the EU and the eurozone by a significant margin. Perceived inflation over the past 12 months reached 10.1 percent in Greece — more than double the eurozone average and more than twice the country’s own harmonized June CPI reading of 3.9 percent.
Expectations for Greek inflation over the next 12 months fell noticeably compared with the first two months of the current conflict, dropping to 7.1 percent from 10.0 percent and 9.9 percent respectively, but still remain the highest in the eurozone and more than double the bloc’s average.
Greek households also hold the most pessimistic growth outlook in the eurozone, expecting economic contraction of 5.4 percent over the next 12 months, compared with a eurozone average expectation of -1.4 percent, itself an improvement from -1.7 percent in May.
Unemployment Fears Persist
Eurozone unemployment expectations for the next 12 months eased marginally to 11.2 percent from 11.3 percent in May. Lower-income households anticipated the highest unemployment rate at 13.8 percent, while higher-income households expected 9.7 percent. Consumers broadly expected future unemployment to be only slightly above their current perceived rate of 10.7 percent, suggesting a generally stable labor market outlook across the bloc.
