The European Central Bank’s (ECB) Survey on the Access to Finance of Enterprises (SAFE) indicates a moderation in price growth expectations among more than 5,000 participating firms. According to the survey, firms now anticipate selling prices to grow by 3.2% year-on-year, a decrease from the 3.5% expected in the previous survey round [1].
Additionally, the growth in non-labour input costs, which includes energy, is projected to rise by 5.2% year-on-year, down from the earlier expectation of 5.8% [1]. Inflation expectations over one, three, and five-year horizons have remained largely stable, suggesting that firms do not foresee significant changes in the inflation outlook in the near to medium term [1].
The survey also highlights that firms expect lower increases not only in selling prices and non-labour input costs but also in wage expectations, indicating a broad-based easing of cost pressures [1]. Furthermore, ongoing geopolitical tensions in the Middle East are prompting firms to seek alternative suppliers and improve energy efficiency, reflecting adjustments in supply chain strategies [1].
CONCLUSION
The ECB SAFE survey points to a cooling in price and cost growth expectations among eurozone firms, with inflation outlooks remaining stable. This moderation in expectations may ease pressure on monetary policy and signal a more balanced economic environment ahead.