ECB survey of professional forecasters see higher inflation and lower growth this year

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<ul><li>Full report <a href="https://www.ecb.europa.eu/press/pr/date/2026/html/ecb.pr260504~bb7a0cbf4c.en.html" rel="nofollow" target="_blank">here</a></li></ul><p>The latest ECB Survey of Professional Forecasters (SPF) showed a complex environment for the Eurozone economy in the short-term, characterized by higher inflationary pressures and softening growth. Professional forecasters have adjusted their expectations for headline inflation, as measured by the Harmonised Index of Consumer Prices (HICP), projecting a rate of 2.7% for 2026 and 2.1% for 2027. These figures represent upward revisions from the previous quarterly survey. Looking further ahead though, expectations for 2028 remain steady at 2.0%, aligning with the ECB’s medium-term target.</p><p>Core inflation expectations, which provide a clearer view of underlying price pressures by stripping out volatile energy and food costs, have also seen near-term increases. Forecasters now anticipate core HICP at 2.2% for both 2026 and 2027, with a slight cooling to 2.1% in 2028. Despite these adjustments, long-term expectations remain anchored.</p><p>The outlook for real economic activity saw downward revisions. Analysts now expect the Eurozone economy to expand by 1.0% in 2026, 1.3% in 2027, and 1.3% in 2028. The 2026 and 2027 forecasts were trimmed by 0.2 and 0.1 percentage points respectively, compared to the start of the year. This is largely attributed to the Middle East conflict, specifically the negative economic impact