FRANKFURT: The European Central Bank unveiled Thursday eurozone inflation and growth forecasts based on its survey of professional forecasters that suggest both could be slightly higher than previously expected this year.The ECB is to release quarterly forecasts by its own staff next month, and the figures just released suggest the next set of data might be revised upwards as well.
The central bank's survey of professional forecasters (SPF) for the first quarter of 2011, published in the ECB monthly bulletin for February, now anticipates growth of 1.6 percent this year, and inflation of 1.9 percent.That would be in line with the bank's medium-term inflation target of below but close to two percent.
The previous SPF had produced levels of 1.5 percent for both growth and inflation in 2011.In December, the range of ECB staff forecasts produced midpoints that put growth and inflation this year at 1.7 percent and 1.8 percent, respectively.Economists forecast an upward revision of both when new estimates are unveiled on March 3.
Eurozone inflation climbed to 2.4 percent in January owing to higher prices for energy and food products, but the ECB reiterated Thursday that "commodity prices are expected to stabilise in the course of 2011."For 2012, the SPF gave a growth estimate of 1.7 percent, unchanged from the previous level, and inflation was now tipped to gain 0.2 percentage points to 1.8 percent.
The upward revision to inflation is "due almost entirely to higher oil and other commodity prices, which, however, are expected to have only a temporary impact on inflation," the ECB said.Its staff forecasts, which are always given as a range, currently have midpoints of 1.7 percent for growth and 1.5 percent for inflation.According to professional forecasters, the latter nonetheless runs the risk of being pushed higher by commodity market instability, tax increases to help curb eurozone debt, or excess liquidity in global financial markets.
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