UBS Boosts Eurozone Inflation Forecast on Energy Price Surge

UBS has raised its forecast for Eurozone inflation to 3.5% year-over-year in September, citing higher energy prices and a one-off increase in German healthcare costs.

The bank's economists led by Anna Titareva expect headline inflation to peak at around 3.6% in early 2027, with annual average forecasts lifted to 2.9% for 2026 and 2.7% for 2027.

UBS notes that August's inflation reading was driven entirely by higher energy inflation, while underlying measures such as exclusion metrics, trimmed means, and domestic inflation were broadly stable or slightly lower.