SUERF Policy Brief The curious case of the European consumer

SUERF Policy Brief, No 1027 1 The curious case of the European consumer Consumption trends and household savings Despite declining inflation and a gradually improving macroeconomic outlook in Europe since 2023, the anticipated consumption rebound has not occurred. [...] This in turn could be driven by a variety of factors, such as: i) a negative view of the housing market, linked to the still restrictive level of interest rates, ii) elevated uncertainty over the macroeconomic and fiscal outlook and iii) a lingering negative perception of inflation. [...] SUERF Policy Brief, No 1027 3 The curious case of the European consumer Prospects for Housing and Consumption While a better outlook for the housing market is certainly positive for the whole economy, the implications for private consumption growth are not straightforward. [...] We think part of the reason for the slow pace of recovery in consumption should be attributed to the slowdown in disposable income growth that occurred at the same time. [...] The views expressed are those of the authors and not necessarily those of the institutions the authors are affiliated with.