Eurozone Inflation Forecast to Remain Elevated at 3%

According to the European Central Bank's (ECB) September forecast, eurozone inflation is expected to remain elevated at an average of 3% in 2026. This prediction comes after a recent surge in prices due to higher energy costs, particularly transport fuels, and the phasing out of government support measures.

The latest data shows that headline HICP inflation rose to 2.9% in July, up from 2.8% in June and 3.2% in May. The increase was driven mainly by higher energy prices, as well as price hikes in the services and non-energy industrial goods sectors.

The ECB noted that underlying HICP inflation excluding energy and food edged up to 2.5% in July, while food inflation continued to ease due to subdued price pressures further along the supply chain.