Economic growth expectations for the year ahead were stable
Inflation expectations in the eurozone continued to decline in September, falling to a three-year low. This is evidenced by the data of the European Central Bank’s monthly survey of 19 thousand consumers.
Average expectations for inflation over the next 12 months fell to 2.4% from 2.7% in August, and remained at their lowest level since September 2021. Inflation expectations for the three years ahead, according to the September survey, fell by 0.2 percentage points to 2.1%, the lowest level since February 2022.
Economic growth expectations for the next 12 months were stable in September at -0.9%. The survey also showed that expectations of the unemployment rate for the next 12 months increased to 10.6% from 10.4%.
Inflation in the euro area in September 2024 increased by 1.8% compared to the same month in 2023. Thus, the indicator slowed down compared to August, when it was 2.2%. The consensus forecast of analysts, cited by Trading Economics, expected a decline in consumer price growth to 1.9% in September.
As reported earlier, the ECB cut key interest rates by 25 basis points on October 17, as analysts had expected. This is the third reduction in a row since June this year. According to the regulator, the decision to cut the deposit rate is based on an updated assessment of the inflation forecast, the dynamics of core inflation and the strength of the transmission effect of monetary policy.
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