Professional forecasters now expect eurozone inflation to average 3.0 percent in 2026 and 2.6 percent in 2027, and to return to the European Central Bank target of 2 percent only in 2028. The main reason given is higher energy prices and their knock on effects.
What happened
The European Central Bank survey, the Survey of Professional Forecasters for the fourth quarter of 2026, was published on October 30, 2026, according to the European Central Bank release. The survey was conducted between October 2 and October 7, 2026, and received 52 responses from experts at financial and non financial institutions based in Europe.
Compared with the previous round, headline inflation expectations were revised up by 0.3 percentage points for 2026 and by 0.4 percentage points for 2027, and were unchanged for 2028. Core inflation, which leaves out energy and food, is now expected to average 2.4 percent in 2026, 2.5 percent in 2027, and 2.2 percent in 2028. Longer term expectations for 2031 stayed at 2.0 percent for both headline and core inflation.
The survey also raised growth expectations a little: real GDP growth of 1.0 percent in 2026 and 1.3 percent in both 2027 and 2028. Unemployment is expected to average 6.4 percent in 2026, easing gradually to 6.1 percent in the longer term, while wage growth is seen slowing from 3.3 percent in 2026 to 3.1 percent in 2027 and 2.8 percent in 2028.
Why it matters for beginners
Inflation is a general rise in prices over time. When forecasters raise their inflation outlook, it tells beginners that everyday costs, especially energy related costs, may stay higher for longer than previously expected. It also matters because central banks watch these forecasts closely.
The European Central Bank held its deposit rate at 2.50 percent on October 29, 2026, and higher inflation expectations can make another rate rise more likely, which can affect borrowing costs for mortgages, loans, and business credit.
At the same time, the survey does not show a runaway price spiral: wage growth is expected to slow, longer term inflation expectations remain anchored at 2 percent, and growth is still expected to continue. For context on recent eurozone growth, see the related post.
What to watch next
Watch the next eurozone inflation readings, especially energy prices, and any signals from the European Central Bank ahead of its December meeting. Also watch the next Eurosystem staff macroeconomic projections, due on December 18, 2026, which will give a fresh official outlook to compare with this survey. A softer energy market could ease the outlook, while another energy shock could push it higher, and the survey itself notes that the risk balance for inflation is tilted to the upside for 2026 to 2028.
Frequently asked questions
What is the ECB Survey of Professional Forecasters?
It is a quarterly survey that gathers inflation, growth, and unemployment expectations for the euro area from experts at institutions based in Europe. Its results do not represent the views of the ECB decision making bodies or its staff.
Why did inflation expectations rise?
The ECB release points mainly to higher energy prices and their indirect effects. Core inflation moved up less, which suggests much of the change came from energy rather than from broad price pressures across all goods and services.
Does this mean interest rates will definitely rise in December?
No. The survey is one input among many. The ECB will weigh fresh inflation data, growth data, and financial conditions before its next decision, so a higher forecast raises the chance of a rise but does not settle it.
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