Euro Area Inflation Expectations Rise Across All Horizons in August

The European Central Bank (ECB) has released the results of its Consumer Expectations Survey for August 2026, showing that Euro area consumers' median inflation expectations rose across all horizons.

One-year expectations increased to 3.0 per cent from 2.9 per cent in July, while three-year expectations rose to 2.9 per cent from 2.7 per cent and five-year expectations moved up to 2.5 per cent from 2.4 per cent.

The median perceived inflation over the previous 12 months was unchanged at 3.5 per cent in August, but uncertainty about inflation expectations over the next 12 months decreased, albeit remaining higher than before the Middle East conflict.

Interestingly, respondents in the bottom income quintile reported higher inflation perceptions and expectations on average than those in the top quintile, with younger respondents aged 18-34 reporting lower inflation perceptions and expectations than older respondents.