Euro area consumer morale rises more than expected

The consumer confidence indicator in the Euro Area rose by 0.6 points to -13.6 in February 2025, the highest level in four months and surpassing market expectations of -14, according to preliminary estimates.

Euro area consumer morale rises more than expected

This improvement suggests that consumers are gradually becoming more optimistic about the economic outlook, driven in part by expectations that the European Central Bank (ECB) will continue cutting interest rates this year to support growth. The ECB is widely anticipated to lower its deposit rate by 25 basis points at each of the next three meetings, which would bring it down from the current 2.75% to 2.00% by mid-year. As inflationary pressures ease and economic conditions stabilize, forecasts increasingly indicate that Eurozone interest rates could fall below 2% by 2026.

Consumer confidence improves in EU too

Meanwhile, consumer confidence also improved in the broader European Union, where sentiment rose by 0.4 points to -12.9. Despite still being in negative territory, this upward trend reflects a cautious but growing optimism among households, supported by expectations of looser monetary policy and a potential recovery in purchasing power.