The European Central Bank (ECB) has released its Survey of Professional Forecasters for the fourth quarter of 2025. The survey indicates a slight upward revision in headline inflation expectations for 2025, attributed mainly to recent data, while projections for subsequent years remain unchanged. Inflation forecasts excluding energy and food show a similar pattern.
Tariffs are anticipated to slightly reduce inflation in the short term by 0.04 percentage points in 2025 and 0.06 percentage points in 2026, with a neutral effect expected by 2027 and beyond. These impacts align with previous survey results.
Real GDP growth expectations have been adjusted upwards by 0.1 percentage points for 2025, now at 1.2%, but remain steady for the following years. Tariffs are expected to negatively affect GDP growth in the near term, consistent with earlier predictions.
Unemployment rate forecasts remain stable, averaging 6.3% for both 2025 and 2026, before declining slightly to 6.2% in 2027 and maintaining that level into the longer term.
Survey respondents predict headline inflation, measured by the Harmonised Index of Consumer Prices (HICP), at 2.1% for 2025, decreasing to 1.8% in 2026 and then rising again to 2.0% in 2027. Core HICP inflation expectations follow a similar trend.
Long-term projections for both headline and core HICP inflation are steady at 2.0%. Growth expectations over the long term remain unchanged at an average of 1.3%.
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