Eurozone consumer expectations for inflation next year rose in October, while forecasts for the next three years remained steady, but with an inflation rate still well above the European Central Bank's 2 percent target, a latest survey showed. of the ECB in October on consumer expectations.

Inflation has soared this year due to extremely high energy and food prices, and the ECB is raising interest rates at a record pace to at least moderate long-term inflation expectations.

Average consumer inflation expectations over the next 12 months rose in October to 5.4 percent from 5.1 percent in September, while inflation expectations over the next three years were unchanged at 3 percent, the ECB said, based on a survey of around 14,000 users in six of the largest countries in the Eurozone.

Inflation hit a record 10.6% in October before falling sharply in November to 10%, but its decline in early 2023 is expected to be slow before disinflation accelerates in the second half of next year.

The rise in inflation prospects in October comes as consumers have become more pessimistic about economic growth and employment, the ECB said.

Consumer expectations for economic growth for the next 12 months fell to -2.6% from -2.4% in September.

In line with lower expectations for economic growth, expectations for the unemployment rate over the next 12 months rose to 12.5% ​​from 12.2% in September.

The survey revealed that consumers expect nominal income growth of 0.7% next year, up slightly from 0.6% in September, while their spending expectations are for their nominal growth to rise 4.7% from September. expectations for a 4.5 percent increase.

Consumers also expect home price growth over the next 12 months to slow to 3.0% from 3.4% in September.

Expectations for mortgage rates over the next 12 months rose further to 4.7%, or 1.4 percentage points higher than at the start of 2022. Their expectations for access to credit over the next 12 months tightened significantly.

However, the share of consumers who reported having applied for credit in the past three months, which is surveyed on a quarterly basis, increased to 13.9% in October from 12.2% in July 2022.

ECB: Bitcoin's Current Stabilization May Be Its 'Last Gasp'

ECB