Eurozone consumers have raised their short-term inflation expectations, signaling that they anticipate further price hikes in the near future. According to a survey published by the European Central Bank (ECB) and reported by Reuters, average inflation expectations for the next year climbed to 3.1 percent in April, up from 2.9 percent in March - a figure notably above the ECB’s 2 percent inflation target.

This rise reflects ongoing uncertainty linked to the global trade war and its impact on the economy. Despite this, consumers’ views contrast with the ECB’s forecast, which expects price growth to ease due to weak economic momentum, moderate wage increases, lower energy prices, and a stronger euro currency.

The survey’s findings, combined with trade tensions fueled by U.S. tariffs, add weight to expectations that the ECB will cut interest rates again next week - marking the eighth rate reduction in just over a year.

Looking further ahead, inflation expectations for the three- and five-year outlook remain steady. Consumers foresee prices rising by 2.5 percent over the next three years and 2.1 percent over five years, maintaining a relatively stable longer-term outlook.

The ECB’s survey gathered responses from 19,000 adults across 11 countries within the eurozone, providing a broad perspective on consumer sentiment amid these economic challenges.