European Central Bank survey shows Eurozone consumers lower their inflation expectations for the next year, easing pressure on interest rate hikes

According to a survey released by the European Central Bank on Friday, Eurozone consumers lowered their inflation expectations for the next year from 4.0% in April to 3.5% in May, while their three-year and five-year inflation expectations remained unchanged at 2.9% and 2.4%, respectively. The European Central Bank, based on a survey of approximately 19000 adults in 11 eurozone countries, stated that the uncertainty of inflation expectations for the next 12 months has decreased, but remains higher than before the outbreak of the Middle East war. The financial market expects the European Central Bank to raise interest rates one to two more times, and the next rate hike will not be fully priced by the market until the autumn.