In its quarterly Survey of Professional Forecasters (SPF), the European Central Bank (ECB) expects Eurozone short- and long-term inflation expectations higher.
Key takeaways
Sees 2022 inflation at 7.3% vs 6.0% seen 3 months ago; 2023 seen at 3.6% vs 2.4%.
Sees 2024 inflation at 2.1% vs 1.9% 3 months ago; longer-term seen at 2.2% vs 2.1%.
2022 GDP growth seen at 2.8% vs 2.9% forecast 3 months ago, 2023 seen at 1.5% vs 2.3%.
Longer-term core inflation expectations rise to 2.2% from 1.9%.
Intensifying energy price pressures, tightening of monetary policy, weakening of household purchasing power a drag on growth.
Separately, European Central Bank (ECB) Governing Council member Madis Muller said on Friday that the time of negative interest rates in the euro area is over.
Also read: Eurozone Preliminary Manufacturing PMI slumps to 49.6 in July vs. 51.0 expected
Market reaction
Amidst renewed concerns over an imminent recession in the bloc, EUR/USD is losing 0.82% on the day to trade at 1.0142, as of writing.
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