[27] In the 1970s, such shifts in the right tail of the distribution preceded shifts in the mean. [28] We broadly know why these shifts happen among consumers who are financially less literate. These consumers predominately form their expectations based on inflation experiences.
[29] But for the euro area, the ECB’s consumer expectations survey shows that people who are financially more literate and who see themselves as playing a relevant role in actual price and wage-setting have recently revised their medium-term inflation expectations to a larger extent than other survey participants. This is a source of concern.