The inflation forecast for 2026 has been lowered by three-tenths to 1.6%, while the projection for 2027 remains unchanged at 2.0%.
In a statement released after the Governing Council meeting held today in Frankfurt, Germany, the ECB notes that the downward revisions of 0.3 percentage points for 2025 and 2026, compared to the March projections, “primarily reflect the lower assumptions for energy product prices and a stronger euro.”
Experts from the Eurosystem predict that inflation, excluding energy and food prices, will average 2.4% in 2025 and 1.9% in both 2026 and 2027, remaining virtually unchanged from March.
“Most measures of underlying inflation suggest that inflation will stabilize sustainably around the ECB Council’s medium-term target of 2%,” states the central bank.
It further details that wage growth “is still high but continues to show a marked moderation,” with profits “partially cushioning its impact on inflation.”
“Concerns have diminished that increased uncertainty and the volatile market response to trade tensions in April would lead to more restrictive financing conditions,” it concludes.
