The European Central Bank’s quarterly professional forecasters predicted steady inflation, modest GDP growth and a gradual decline in the unemployment rate in their third quarter survey, on Friday 19 July 2024.

Headline inflation, as measured by the harmonised index of consumer prices (HICP), was forecasted to remain steady at 2.4% for 2024 and 2.0% for 2025, with a slight downward revision to 1.9% for 2026. The survey found that expectations for core HICP inflation, which excludes energy and food, were revised upwards slightly for both 2024 and 2025. This adjustment reflected recent data and more persistent services inflation and labour cost growth. Long-term expectations for both headline and core HICP inflation remained steady at 2.0%.

The forecasters anticipated euro area real GDP growth to reach 0.7% in 2024, 1.3% in 2025 and 1.4% in 2026. Compared with the previous survey, the growth forecast for 2024 was revised up by 0.2 percentage points, attributed to a stronger than expected first quarter of 2024. Conversely, the growth forecast for 2025 was revised down by 0.1 percentage points, while the 2026 forecast remained unchanged. Long-term growth expectations stayed consistent at 1.3%.

The survey also indicated a revised profile for the unemployment rate over the period from 2024 to 2026. Respondents still expected an increase in the unemployment rate to 6.5% in 2024, followed by a decline to 6.4% in 2026, with the rate stabilising at 6.4% in the long term.