Frankfurt (Reuters) – EURO Zone Consumers have reduced their short -term inflation expectations last month, but continued to see the economic contraction in front, indicating that households remain relatively reduced on the block appearances, ECB research shows on Friday.
Medium expectations of inflation in the next 12 months in January have decreased to 2.6% from 2.8% in the previous month, while the three -year expectations remained unchanged to 2.4%, above the ECB goal of 2%, according to the European Central Bank.
The decline came because households reduced the expectation of nominal income growth to 0.9% with 1.1%, indicating that families predict the fall in the earnings adapted to inflation, which would then be withdrawal of growth.
The muffled figures add to the case for greater decreasing interest rates than ECB, and the move next Thursday is considered to be a large extent and completed a job with a discussion that is already focusing on how much ECB would have to do in the coming months.
Investors are now predicting between two and three cuts after March 7th, and the bets have oscillated mainly in response to Washington news about trade policy.
Although consumers were less pessimistic in growth, the economy continued to decrease by 1.1% in the next year after they had foreseen 1.3% of contraction in December.
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