FX.co ★ Euro Area Inflation Expectations Fall for 2nd Month in February

Eurozone median inflation expectations for the next 12 months fell for the second consecutive month in February 2026, slipping to 2.5% from 2.6% in January and reaching their lowest level since October 2024. Expectations for inflation three years ahead also declined, to 2.5% from 2.6%, while five‑year‑ahead inflation expectations were unchanged at 2.3%. Uncertainty surrounding 12‑month inflation expectations remained stable.

At the same time, households’ expectations for home price growth over the next 12 months eased to 3.6% from 3.7%, and expectations for mortgage interest rates in 12 months held steady at 4.7%. Elsewhere, expectations for nominal income growth over the next year were unchanged at 1.2%, while expectations for spending growth edged up to 3.5% from 3.4%.

Perceptions of the broader economy also improved slightly: expectations for economic growth became less negative (-0.9% versus -1.1%), and the expected unemployment rate ticked down to 10.8% from 11%.