European Central Bank (ECB) Governing Council member Boris Vujčić stated that household expectations regarding inflation, income, employment, interest rates, and house prices significantly influence spending, saving, investment, borrowing, and wage demands. These expectations play a key role in shaping the monetary policy transmission mechanism. He highlighted that traditional macroeconomic analysis often relied on assumptions of rational expectations, but recent evidence underscores the limitations of these assumptions, necessitating direct measurement of expectations through high-quality, population-representative surveys. Vujčić noted that insights from surveys like the ECB’s Consumer Expectations Survey reveal how geopolitical risks can worsen household sentiment and spending intentions in the euro area.