European Central Bank's latest survey on consumer expectations reveals a decline in optimism regarding economic growth, while inflation expectations remain stable. The estimated inflation rate for the previous 12 months dropped to 3.1% in February, down from 3.4% in January, marking the lowest level since September 2021.

Despite this decrease, consumers anticipate inflation to hold steady over the next 12 months at 2.6%, and they expect it to remain at 2.4% over the next three years.

Conversely, sentiment regarding economic growth has taken a more negative turn, with projections settling at -1.2% for the next 12 months, a decline from -1.1% in January but slightly improved from December's -1.3%.

Additionally, expectations for the unemployment rate have risen to 10.5%, returning to December levels, up from 10.4% in January. On a brighter note, anticipated nominal consumer income growth over the next 12 months has increased to 1.0%, up from 0.9% in January.