ECB Survey Shows Slight Rise in Inflation Expectations

Recent reports highlight persistent concerns about inflation in the Eurozone and globally. The European Central Bank’s latest survey projects slightly higher inflation rates of 2.2% in 2025 and 2% in 2026, with longer-term expectations anchored at 2%. ECB Governing Council member Madis Muller warned that US trade tariffs and increased public spending in Germany could further fuel inflation, urging caution about lowering interest rates. Meanwhile, analysis of recent euro adoption in countries like Croatia and Lithuania shows that the currency switch itself had only a minor effect on inflation, with most price increases attributed to external shocks and opportunistic pricing rather than the euro. Regulatory oversight is seen as key to preventing unjustified price hikes. Globally, inflation is squeezing consumers, particularly the middle class, as wages often fail to keep pace with rising costs for essentials, forcing households to adjust spending habits and prioritize necessities.