Eurozone median inflation expectations for the next 12 months fell to 3.5% in May 2026, the lowest level in three months, after standing at 4.0% in each of the previous two months, which had marked the highest readings since 2023. Consumers now expect house prices to rise by 3.6% over the next year, slightly below April’s 3.7%. Expectations for mortgage interest rates were unchanged at 4.9%.
Longer-term inflation expectations remained stable, at 2.9% for three years ahead and 2.4% for five years ahead. Uncertainty surrounding 12‑month inflation expectations eased, but stayed elevated compared with levels observed before the outbreak of the Middle East conflict.
Elsewhere, consumers’ expectations for nominal income growth over the next 12 months rose to 1.0%, up from 0.8% in April. Expectations for economic growth over the year ahead improved to -1.7%, from -2.2% previously, while expectations for the unemployment rate 12 months ahead inched up to 11.3% from 11.2% in April.
