ECB Survey: Inflation Expectations Unchanged, Growth Forecast Revised Down
The European Central Bank (ECB) released its Survey of Professional Forecasters for the third quarter of 2026. The survey showed that headline HICP inflation expectations remained unchanged from the previous round, while core inflation expectations increased by only 0.2 percentage points in 2026.
Respondents expected headline inflation to decrease from 2.7% in 2026 to 2.2% in 2027 and 2.0% in 2028. Longer-term HICP inflation expectations remained unchanged at 2.0%. The respondents also forecasted real GDP growth of 0.6% in 2026, 1.2% in 2027, and 1.3% in 2028.
The survey asked special questions about the war in the Middle East, which showed limited expected indirect and second-round effects on inflation, mainly affecting 2026. Forecasters saw any effects as relatively short-lived and concentrated in 2026, reduced in 2027, and having disappeared by 2028.