Our Survey of Monetary Analysts likewise suggests that inflation will be close to target in 2024, while inflation will remain elevated next year. Meanwhile, the three-year-ahead inflation expectations of households have risen above target, although the term structure of expectations remains downward-sloping. While it is well-known that consumer expectations exhibit high sensitivity to near-term inflation, the above-target revisions should not be taken lightly.
Overall, the evidence suggests that the euro area is not experiencing a broad-based de-anchoring of medium-term inflation expectations. As indicated above, it is an essential task for monetary policy to ensure that this remains the case.