Financial analysts surveyed by the European Central Bank for the third quarter (Survey of Professional Forecasters) predict significantly higher inflation but limited losses on the growth front compared to the forecasts they had made in the previous quarter.
Analysts forecast average inflation of 7.3% this year and 3.6% in 2023 versus 6% and 2.4%, respectively, in the previous survey. For 2024, they estimate that inflation will be 2.1% against a previous forecast of 1.9%.
For growth, they forecast it to move to 2.8% this year and 1.5% in 2023 versus 2.9% and 2.3%, respectively, they forecast in the previous quarter. For 2024, the forecast has remained the same at 1.8%.
Analysts noted that the better-than-expected economic performance in the first quarter of 2022 largely offset the weaker momentum expected for the other quarters of the year. The main factors contributing to the weakening outlook are rising energy costs, tightening monetary policy worldwide and the impact of inflation on household purchasing power.
Supply chain bottlenecks linked to the coronavirus have eased somewhat, but remain a drag on the global economy, analysts say. Conversely, fiscal measures to address energy price increases have dampened the shock to some extent, and the re-opening of the economy after the lifting of coronavirus restrictions has also had a positive impact on growth.
Source: Capital
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