- Inflation is expected to decline from an average of 8.4% in 2022 to 6.3% in 2023
- Inflation is then expected to decline to an average of 3.4% in 2024 and of 2.3% in 2025
- Headline inflation is expected to fall to the ECB’s medium-term inflation target of 2% in the second half of 2025
- But HICP inflation excluding energy and food will remain above 2% throughout the horizon
- Risks to the economic growth outlook are on the downside, especially in the near-term
- The risks to the inflation outlook are primarily on the upside
- Tighter financing conditions would mitigate the build-up of financial vulnerabilities and lower tail risks to inflation over the medium-term
- Interest rates will still have to rise significantly at a steady pace to reach levels that are sufficiently restrictive to ensure a timely return of inflation to the 2% medium-term target
- Full release
There's nothing new here as this is mostly a capsule of views held by the ECB and policymakers have put out such remarks over the course of the past few months already.