ECB: Higher but Still Temporary Inflation Ahead

EU inflation in the coming years will be higher than previously estimated and only slightly below the ECB target of 2% in 2022, showed on Friday the ECB poll, which is one of the main sources of information which drive policy decisions of the Central Bank.
According to the survey of professional forecasters, the growth of consumer prices in 2021 will be 2.3%, and in 2022 - 1.9%, compared with 1.9% and 1.5%, respectively, in the previous survey, which was conducted three months ago.
"Respondents attribute the upward revision mainly to higher energy prices and the impact of supply chain tensions," the ECB said.
"Although both of these factors were mentioned in the previous poll, the development of the situation in recent years, according to experts, was more tense and, as experts expect, this tension will be observed longer than previously thought."
Inflation, which has already doubled the ECB's target level, will continue to accelerate and possibly reach 4% in the coming months due to skyrocketing commodity prices and industrial supply bottlenecks, which will put pressure on both producer prices and consumer prices.
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