Forecasters lift euro area inflation to 3.0% for 2026, keep long-term at 2%

Victoria Shinder31 October 2026, 10:432 min read

The ECB's Survey of Professional Forecasters for the fourth quarter, published on 30 October (https://www.ecb.europa.eu/press/pr/date/2026/html/ecb.pr261030~e92c3c838c.en.html), shows economists absorbing the energy shock into their near-term numbers without letting it reach the long run. The survey was conducted from 2 to 7 October and drew 52 responses.

Expected headline inflation is 3.0% for 2026, 2.6% for 2027 and 2.0% for 2028. That is 0.3 percentage points higher for this year and 0.4 points higher for next year than in the third-quarter survey, and unchanged for 2028. Core inflation, excluding energy and food, is expected at 2.4%, 2.5% and 2.2%, with the 2027 figure up 0.2 points. Longer-term expectations, for 2031, stayed at 2.0% for both headline and core. A special question on the war in the Middle East found respondents expect the additional effects of the energy price shock mainly in 2027 but limited second-round effects. Inflation risks were seen tilted upward for 2026 to 2028.

Growth expectations moved up rather than down: 1.0% for 2026, a revision of 0.4 points that mostly reflects recent data, and 1.3% for 2027 and 2028. Unemployment is expected at 6.4% this year, falling gradually to 6.1%. Expected wage growth is 3.3% for 2026, easing to 2.7% in the longer term, a downward revision of 0.2 points for that horizon.

What it means

The pattern is the one central banks hope for in a supply shock: higher inflation for two years, an unchanged 2% anchor and wage expectations that drift down rather than up. That is the argument for looking through the shock. Against it stands the 2027 revision, the largest in the table: if professional forecasters now see inflation above target for a second year, the ECB's December projections, due on 18 December, will be read for whether staff agree, and with them the case for the hike the Governing Council discussed this week.