Inflation rate is below target next year, according to ECB survey


Inflation in the Frankfurt-Eurozone could fall below 2% next year as well. According to a new survey released by the European Central Bank, it was released on Friday the day after the European Central Bank warned of rising consumer price pressure.

The ECB remained unchanged on Thursday, but eventually acknowledged rising inflation risk, turning around for banks that have maintained policy very easily over the past decade, opening the door to interest rate hikes this year. opened.

According to a survey by the ECB’s Professional Forecasters, inflation this year was 3%, below the bank’s own forecast of 3.2%. In 2023, research showed that price increases could slow to 1.8%, in line with the ECB’s own expectations.

Inflation in 19 currencies hit a record high of 5.1% last month, more than double the ECB’s 2% target and well above expectations. This shows that banks are having a hard time fully understanding current price trends.

In response to a sustained overshoot in recent quarters, ECB Governor Christine Lagarde said risk is now “upwardly leaning” and higher readings are still possible before it falls in late 2022. Suggested that.

Studies have shown that inflation is usually an important input in policy debates, rising to 1.9% in 2024 and rising to 2% in the long run, defined as 2026.

According to the survey, this year’s economic growth rate was 4.2%, in line with the ECB’s December forecast. After that, we can see that the ECB staff has slowed to 2.7%, down from the previously predicted 2.9%.

Reuters

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