ECB
The European Central Bank has cut its inflation forecasts while keeping a sharp eye on growth, according to its latest economic forecasts released today.
The latest projections suggest that the ECB's fight against inflation is making progress, although the path to its 2% target is still small. The subdued growth outlook could add pressure for rate cuts in the coming months. The market is almost fully priced for another 25 bps cut in January.
HICP Inflation:
- 2024: Depreciation to 2.4% (from 2.5%)
- 2025: Depreciation to 2.1% (from 2.2%)
- 2026: Depreciation to 1.9% (from 2.0%)
- 2027: New forecast of 2.1%
Main HICP (old energy & food):
- 2024: No change at 2.9%
- 2025: No change at 2.3%
- 2026: Depreciation to 1.9% (from 2.0%)
- 2027: New forecast of 1.9%
GDP growth:
- 2024: Depreciation to 0.7% (from 0.8%)
- 2025: Reduction to 1.1% (from 1.3%)
- 2026: Reduction to 1.4% (from 1.5%)
- 2027: New forecast of 1.3%
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