ECB CES: Inflation expectations moderated further in June

Research evidence excerpt

ECB CES: Inflation expectations moderated further in June

J P M O R G A N Europe Economic Research

24 July 2026

ECB CES: Inflation expectations

moderated further in June

• Consumer inflation expectations moderated in June, though remaining Economic and Policy Research

above pre-conflict levels Mariana Monteiro

• The ECB minutes suggested that declining inflation expectations from (44mariana.reispaivamonteiro@jpmorgan.com20) 3493-5147

shorter to longer horizons indicate that consumers still view the shock as J.P. Morgan Securities plc

largely temporary

• The recent re-escalation of the Middle East conflict and renewed increases

in energy prices risk stalling, or even reversing, this improvement in

expectations

Ahead of the recent renewed rise in energy prices and the re-escalation of

geopolitical tensions, the ECB’s Consumer Expectations Survey (CES) indicated

a further easing in consumers’ inflation expectations in June – though expectations

remained above pre-conflict levels. Today’s decline was broadly in line with our

own view and was foreshadowed by last month’s European Commission (EC)

consumer survey.

Changes were most pronounced in the near-term measures. In June, median

consumers’ perceptions of past inflation and their one-year-ahead expectations

edged down by 0.4%-pt and 0.5%-pt, to 3.6% and 3.0%, respectively. By

comparison, three-year-ahead expectations declined more modestly (down 0.1%-

pt to 2.8%), while five-year-ahead expectations were unchanged at 2.4%.

The ECB also tracks the spread and skewness of the distribution of expectations,

which continued to improve – particularly at the near-term horizon – suggesting

that more extreme views have further eased. Even so, mean expectations remain