How should the fall in expected inflation in the euro zone be interpreted?

Since late 2018, expected inflation in the euro zone has declined markedly at all maturities, even though wages and unit labour costs have been accelerating. What accounts for this fall in expected inflation in the euro zone? Either the correct perception that the high intensity of competition prevents increases in unit labour costs from passing through to prices; Or the misperception that the euro zone is going to slide into recession. We believe the second interpretation (expectation of a recession) is the right one.