(July 24): Inflation expectations among euro-area consumers for the next year declined significantly in June, a period that predates the oil spike triggered by a new flareup in fighting in the Middle East.

Consumer prices were seen rising 3%, down from 3.5% in May, a monthly survey by the European Central Bank (ECB) showed on Friday. The three-year gauge, which is more important for setting monetary policy, slipped to 2.8% from 2.9% 

The survey was conducted June 4-29, a period in which the US and Iran signed a memorandum of understanding following a ceasefire. That truce didn’t hold, with new hostilities breaking this month.

The poll numbers were released one day after the ECB decided to hold rates, at a decision where president Christine Lagarde laid the groundwork for a possible hike in September.

In another potentially encouraging sign, the ECB’s corporate telephone survey published on Friday showed that businesses for the second quarter reported a less pronounced increase in selling prices than expected and forecast a slight moderation between July and September.

According to the survey — based on exchanges between June 22 and July 1 — they also continued to anticipate slowing wage growth, now seeing it at 2.5% in 2026 and 2.4% in 2027 after 3.1% last year.

Meanwhile, a separate ECB survey of professional forecasters published on Friday was little changed from a quarter ago on inflation, though the expectations for 2026 economic growth were almost halved.

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