eurozone inflation forecast 2020Blog

eurozone inflation forecast 2020

As such, large-scale net asset purchases are likely to be part of the eurozone landscape for the foreseeable future.Headline inflation is likely to experience a rollercoaster ride over the coming quarters given the impact of swings in oil prices.
Due to the lower base in 2020, the annual growth rate in 2021 has risen, despite the fact that we have lowered the quarterly growth pattern.

In addition, inflation expectations have fallen further over the last few months, which will also depress both wage growth and inflation directly.

An additional factor that triggered the revision is that the lockdowns in various eurozone countries have been extended into the first weeks of May, whereas we had assumed that they would end at the time that was initially announced by the various governments, which was in the course of the second half of April in most cases.

Our main task is to maintain price stability in the euro area and so preserve the purchasing power of the single currency. (Aline Schuiling & Nick Kounis)Stay informed with e-mail newsletters from ABN AMRO.Global Daily – Extending the eurozone lockdowns… what is the impact?We gebruiken cookies om er zeker van te zijn dat je onze website zo goed mogelijk beleeft. On a monthly basis, consumer prices are expected to decrease by 0.3 percent, after a 0.3 percent increase in June.The consumer price inflation in the Euro Area was confirmed at 0.3 percent year-on-year in June 2020, up from a four-year low of 0.1 percent in the previous month. The news released saw the pound to euro rate gently slide from over 1.11, and 1.31 on GBPUSD, to 1.30 and 1.10 respectively. Although we expect oil prices to remain low in the near term, we expect a recovery later this year and next (to around USD 50 p/b by the end of next year). Stay informed and spot emerging risks and opportunities with independent global reporting, expert What is more, the easing of the lockdown measures that has been announced in most countries will be very gradual and step-by-step, which implies that the rebound in growth after the full lockdown will be weaker than we had assumed before.Finally, the negative second round effect from lockdowns (higher unemployment, tighter financial conditions, corporate defaults, supply chain disruptions) are expected to be stronger because the lockdowns lasted longer. We expect core inflation to slide over the coming quarters end next year at levels that are not far from zero.Against this background, the risks of a sustained period of modest deflation are now significant. The annual core inflation, which excludes volatile prices of energy, food, alcohol & tobacco and at which the ECB looks in its policy decisions, stood at 0.9 percent, unchanged from April's eight-month low and well below the central bank's target of just below 2 percent. Download historical data for 20 million indicators using your browser.Direct access to our calendar releases and historical data. The annual inflation rate in the Euro Area is expected to pick up to 0.4 percent in July of 2020 from 0.3 percent in the previous month and above market expectations of a 0.2 percent gain, a flash estimate showed. The local HICPs are supplied to the Eurostat by the National Statistical Institutes. On a monthly basis, consumer prices increased 0.3 percent, reversing a 0.1 percent decline in May.The annual inflation rate in the Euro Area is expected to pick up to 0.3 percent in June 2020 from a four-year low of 0.1 percent in the previous month and above market expectations of a 0.1 percent gain, a flash estimate showed. Overall, our annual GDP growth forecast for 2020 has been lowered to -6.9%, down from -4.3%. Euro Macro: Changes to our eurozone growth and inflation forecasts – We have lowered our outlook for growth and inflation in 2020 and 2021 in the eurozone. The statistic shows the inflation rate in the European Union (EU) and the Euro area from 2014 to 2017, with projections up until 2024. An important judgement behind this view is that the demand shock hitting the economy is overshadowing the supply shock and this will remain the case despite aggressive monetary and fiscal stimulus.
... GDP in Italy and France also fell sharply but less than forecast, respectively by 12.4% and 13.8%. A recovery begins in Q3 with headline inflation reaching around 1.5% by the middle of next year. It then falls back down to around 0.5% by the end of 2021. Discover more about working at the ECB and apply for vacancies. This month’s edition of the forecast comparison contains short-term forecasts for 2019 and 2020. Main upward pressure came from services (1.2 percent vs 1.3 percent in May), non-energy industrial goods (0.2 percent, the same as in May) and food, alcohol & tobacco (3.2 percent vs 3.4 percent). Eurozone: Inflation slumps to over three-year low in April on plunging energy prices. Energy prices tumbled 11.9 percent (vs -9.7 percent in April), while inflation slowed for both food, alcohol & tobacco (3.4 percent vs 3.6 percent) and non-energy industrial goods (0.2 percent vs 0.3 percent). Main upward pressure should come from services (1.2 percent vs 1.3 percent in May), non-energy industrial goods (0.2 percent, the same as in May) and food, alcohol & tobacco (3.1 percent vs 3.4 percent). Over the medium term, inflation is expected to increase as it is assumed that the oil price will pick up and as demand recovers. The main components of the HICP are: food, alcohol and tobacco (19 percent of the total weight), energy (11 percent), non-energy industrial goods (29 percent) and services (41 percent). 13th August 2020 The pound has been lower in the last 24 hours as the currency markets digest some not wholly unexpected news that the UK entered its deepest recession on record in May to June, coming in at -20.4%.

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