Anna 
Eurozone consumers have tempered their inflation expectations for the next 12 months, contributing to a rise in the EUR/USD pair as the dollar exhibits weakness.
According to the European Central Bank’s (ECB) Consumer Expectations Survey, Eurozone consumers now anticipate inflation over the next year to be 3.0%, slightly below the previous month’s forecast of 3.1% and marking the lowest reading since December 2021.
Meanwhile, inflation expectations for the next three years remained steady at 2.5% for the fourth consecutive month, surpassing the ECB’s target of 2.0%.
Despite plans by the ECB to reduce interest rates in June, uncertainties persist due to escalating energy costs, persistent inflation in services, and ongoing geopolitical tensions.
In currency markets, the EUR/USD pair climbed 0.2% to 1.0746, driven by the dollar’s weaker sentiment.
Looking ahead, ING analysts highlighted the upcoming Bank of England (BoE) policy meeting on May 9 as a significant event for the pound (GBP), though they noted that economic data could be more influential given a divided Monetary Policy Committee (MPC).
