Euro area inflation expectations for 2026 and 2027 were revised up in the European Central Bank's latest Survey of Professional Forecasters, which pointed to higher energy prices and their indirect effects as the main driver, while longer-term expectations stayed anchored at 2.0 per cent.
Headline inflation was expected at 3.0 per cent in 2026, 2.6 per cent in 2027 and 2.0 per cent in 2028, up 0.3 and 0.4 percentage points for the first two years from the previous survey and unchanged for 2028. Core inflation, excluding energy and food, was expected at 2.4 per cent in 2026, 2.5 per cent in 2027 and 2.2 per cent in 2028. Longer-term expectations for 2031 remained at 2.0 per cent for both headline and core inflation.
The survey was conducted between 2 and 7 October 2026 and drew 52 responses from experts at financial and non-financial institutions based in Europe. The ECB said the results do not represent the views of its decision-making bodies or staff. The next Eurosystem staff macroeconomic projections are scheduled for 18 December 2026.
Responses to a special question on the impact of the war in the Middle East suggested that additional effects of the energy price shock were mainly expected for 2027, but that second-round effects would remain limited. The balance of risks around inflation was tilted to the upside for 2026 to 2028, and more balanced thereafter.
Real GDP growth expectations were revised up by 0.4 percentage points to 1.0 per cent for 2026 and by 0.1 percentage points to 1.3 per cent for 2027, with 2028 unchanged at 1.3 per cent. Longer-term growth expectations for 2031 were revised up by 0.1 percentage points to 1.3 per cent. The balance of risks around growth was tilted somewhat to the downside at all horizons.
Unemployment was expected at 6.4 per cent in 2026, easing gradually to 6.1 per cent in the longer term. Wage growth expectations stood at 3.3 per cent in 2026, 3.1 per cent in 2027 and 2.8 per cent in 2028, falling to 2.7 per cent in the longer term.
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Euro area headline inflation expectations, by horizon
percent
Headline inflation is measured by the HICP. Longer-term expectations refer to 2031. Source: ECB Survey of Professional Forecasters, Q4 2026
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Analysis
Why This Matters
Expectations of higher inflation in 2026 and 2027, driven by energy prices, could keep the ECB cautious about easing policy even as longer-term expectations stay anchored at 2 per cent.
The upside risk balance for inflation over the next three years suggests forecasters see more chance of overshooting than undershooting.
Growth expectations have been lifted for the near term, but with risks tilted to the downside, the euro area recovery remains finely balanced.
Background
The Survey of Professional Forecasters is a quarterly ECB exercise gathering expectations for inflation, real GDP growth and unemployment in the euro area, together with a quantitative assessment of the uncertainty around them. Results have been published on the ECB's website since 2015. The survey's respondents are experts at European financial and non-financial institutions, and the results do not represent the views of the ECB's decision-making bodies or staff. It is one of the inputs the ECB uses alongside its own staff projections, the next of which are due on 18 December 2026.
What to Watch
The Eurosystem staff macroeconomic projections for the euro area, due 18 December 2026, for an official cross-check on the forecasters' numbers.
Whether the energy price shock feeds into second-round effects in 2027, which respondents currently expect to remain limited.
Whether the downside risk to growth materialises, particularly for the 2028 horizon.
12 claims in this story checked against 1 source: 12 supported.
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SupportedThe ECB survey revised inflation expectations upwards for 2026 and 2027, while longer-term expectations remained anchored at 2.0%.ECB - European Central Bank: “Headline and core inflation expectations revised upwards for 2026 and 2027, owing primarily to higher energy prices and their indirect effects, with longer-term inflation expectations remaining anchored at 2.0%”
SupportedHigher energy prices and their indirect effects were the main driver of the inflation revisions.ECB - European Central Bank: “Headline and core inflation expectations revised upwards for 2026 and 2027, owing primarily to higher energy prices and their indirect effects”
SupportedHeadline inflation was forecast at 3.0% in 2026, 2.6% in 2027 and 2.0% in 2028, with the first two forecasts revised up by 0.3 and 0.4 percentage points.ECB - European Central Bank: “Respondents’ expectations for headline inflation, as measured by the Harmonised Index of Consumer Prices (HICP), stood at 3.0% for 2026, 2.6% for 2027 and 2.0% for 2028. Compared with the previous round, these were revised up by 0.3 and 0.4 percentage points for 2026 and 2027 respectively”
SupportedCore inflation was forecast at 2.4% in 2026, 2.5% in 2027 and 2.2% in 2028.ECB - European Central Bank: “Core (HICP excluding energy and food) inflation SPF Q4 2026 2.4 2.5 2.2 2.0”
SupportedLonger-term expectations for 2031 were 2.0% for both headline and core inflation.ECB - European Central Bank: “Longer-term expectations (for 2031) remained at 2.0% for both headline and core inflation.”
SupportedThe survey was conducted from 2 to 7 October 2026 and received 52 responses.ECB - European Central Bank: “The Survey of Professional Forecasters (SPF) for the fourth quarter of 2026 was conducted between 2 and 7 October 2026 and 52 responses were received.”
SupportedResponses to a special question about the war in the Middle East suggested additional energy-price-shock effects were mainly expected in 2027, while second-round effects were expected to remain limited.ECB - European Central Bank: “The responses suggested that additional effects of the energy price shock are mainly expected for 2027 but that second-round effects will remain limited.”
SupportedThe inflation risk balance was tilted to the upside for 2026–28 and more balanced thereafter.ECB - European Central Bank: “For inflation, the risk balance was tilted to the upside for 2026-28 but remained more balanced thereafter.”
SupportedReal GDP growth was forecast at 1.0% in 2026, 1.3% in 2027 and 2028; expectations were revised up by 0.4 percentage points for 2026 and 0.1 points for 2027, while longer-term growth expectations were revised up 0.1 points to 1.3%.ECB - European Central Bank: “Respondents expected real GDP growth of 1.0% in 2026 and 1.3% in both 2027 and 2028. Expectations were revised up by 0.4 percentage points for 2026 and by 0.1 percentage points for 2027 compared with the previous survey and were unchanged for 2028. Longer-term growth expectations (for 2031) were revised up by 0.1 percentage points to 1.3%.”
SupportedThe balance of risks around growth was tilted somewhat to the downside at all horizons.ECB - European Central Bank: “For real GDP growth, the balance of risks was tilted somewhat to the downside for all horizons.”
SupportedUnemployment was forecast at 6.4% in 2026 and to decline gradually to 6.1% in the longer term.ECB - European Central Bank: “Unemployment rate expectations were slightly higher for 2026 at 6.4%, before declining gradually to 6.1% in the longer term.”
SupportedWage growth was forecast at 3.3% in 2026, 3.1% in 2027, 2.8% in 2028 and 2.7% in the longer term.ECB - European Central Bank: “Wage growth SPF Q4 2026 3.3 3.1 2.8 2.7”
