Based on a monthly survey of consumer expectations, the Bundesbank reported on Friday that German households are becoming less pessimistic about the prospects for inflation and forecasting a moderating in price pressures over the coming year.
According to the Bundesbank, expectations for inflation over the next 12 months in the largest economy in the euro zone decreased from 8.2% to 7.9%, and the proportion of people expecting it to rise significantly also decreased from 49% to 39%.
Inflation in the euro zone reached a record high of 10.6% in October but then declined to 10% a month later, giving rise to optimism that the top of an energy-driven price increase had been reached.
A Reuters poll of analysts found that while disinflation in the bloc is still likely to be gradual, overall price growth is not anticipated to return to the European Central Bank’s 2% target until 2025.
According to the survey’s median prediction, German inflation is now anticipated to average 5% over the next five years, which is also a decrease from one month ago.
Post Your Comments