Key facts
- Euro zone inflation forecast for this year raised to 3.0% from 2.7%.
- Next year's inflation forecast raised to 2.6% from 2.2%.
- Core inflation seen at 2.4% this year and 2.5% next.
- Inflation not expected to return to 2% target until 2028.
- Wage growth seen slowing to 3.1% next year from 3.3% this year.
The European Central Bank's Survey of Professional Forecasters, released on Friday, indicated that euro zone inflation is expected to be significantly higher this year and next than previously anticipated. Projections for this year were revised up to 3.0% from 2.7%, and for next year to 2.6% from 2.2%. The survey suggests inflation may not return to the ECB's 2% target until 2028. Core inflation, excluding food and energy, is projected to average 2.4% this year and 2.5% next, remaining above 2% even in 2028. Forecasters do not expect a wage-price spiral, with wage growth anticipated to slow.