Personal Inflation Rates in the Euro Area

Using granular household-level spending data from the ECB Consumer Expectations Survey, we document new stylized facts on the heterogeneity of personally realized inflation across different inflation regimes in the euro area. During the period of low inflation (April 2020 – April 2021) and the period of sticky inflation (January 2024 – October 2024), homeowners, high-income households, and older individuals experienced lower inflation. However, during the inflation surge (July 2021 – October 2023), this pattern reversed as rising energy and food prices disproportionately affected these groups, outweighing their lower spending shares in these categories. Personally experienced inflation accounts for a significant share of the variation in inflation perceptions, inflation expectations, and broader macroeconomic expectations, including personal income expectations. Moreover, these relationships differ notably across inflation regimes.