SDG 8: Decent Work and Economic Growth | SDG 10: Reduced Inequalities
Institutions: Ministry of Finance
The European Central Bank’s (ECB) Consumer Expectations Survey (CES) results for October 2025 indicated a complex picture of consumer sentiment regarding the Euro area economy. Short-term inflation expectations for the next 12 months increased slightly to 2.8% (up from 2.7% in September), despite perceived inflation over the previous 12 months holding steady at 3.1% for the ninth consecutive month. Crucially, medium and long-term inflation expectations (three and five years ahead) remained anchored at 2.5% and 2.2% respectively, near the ECB’s 2% target. Consumer expectations for nominal income growth over the next 12 months also saw a marginal increase, rising to 1.2% from 1.1%.
Sentiment regarding the overall economy remained cautious: expectations for economic growth over the next 12 months became slightly less negative, rising from -1.2% to -1.1%. However, expectations for the unemployment rate 12 months ahead increased to 11.0% (up from 10.7%). This disparity highlights consumer anxiety about the labor market even as the overall economic outlook stabilizes. The survey also noted persistent heterogeneity across income groups, with lower income quintiles consistently reporting higher inflation perceptions and expected unemployment rates compared to higher income quintiles.
Policy Relevance: The slight uptick in short-term inflation expectations (2.8%) while long-term expectations remain anchored (2.2%-2.5%) presents a mixed signal for the ECB’s Governing Council. The data confirms that monetary tightening is impacting credit conditions—households reported an increase in the net percentage expecting tighter credit—but the economic slowdown is also raising consumer concerns about job security and unemployment.
What is the Consumer Expectations Survey (CES)?→ The CES is a monthly online survey conducted by the ECB across 11 Euro area countries. It gathers forward-looking data on household perceptions and expectations regarding key economic variables, including inflation, income, consumption, the labor market, and housing. The results provide central banks with crucial insights into how monetary policy is being transmitted and perceived by consumers.
Follow the full news here: ECB Consumer Expectations Survey results – October 2025