Inflation in the euro area will be back in the future but remains driven by volatile food and energy prices, a quarterly survey of energy forecasters European Central Bank suggested Friday.
By 2017, economists predict an average inflation rate of 1.6 percent – compared to a previous forecast of 1.4 percent – in the single currency area of 19 countries, followed by 1, 5 per cent in 2018 and 1.7 per cent in 2019.
In addition, price growth is expected to reach 1.8% by 2021, around the ECB target of close but below 2.0% per year – The most favorable level of growth.
Analysts' expectations vary only slightly from the central bank's internal estimates of 1.7% in 2017, 1.6% in 2018 and 1.7% in 2019.
Policy makers will have new forecasts of staff inflation available at their next monetary policy meeting in June.
Many observers expect President Mario Draghi to use his press conference after this meeting to suggest a gradual exit from the purchase of mass coupons next year.
Stronger votes on the ECB 's board of directors are already pushing to end the 60 billion euro bond buy – back program Frankfurt (65 billion dollars) per month and a rise in historical interest rates low.
Central bank interventions are designed to inject money into the financial system and encourage business and household lending, fuel the real economy towards growth and stimulate inflation .
Draghi and his supporters argue that global inflation is driven by price changes in volatile items like food and energy, saying that pressure from other sources, such as Higher wages, remains low.
"Core" inflation, excluding the fastest items, will take longer to tackle the target, says the president, which means that support from the ECB will be needed for more long time.
The poll suggested Friday that underlying inflation will reach 1.1% this year, followed by 1.3% next year and 1.5% in 2019 – still well below The objective of the ECB.
Forecasters were more optimistic than the central bank, which currently projects core inflation of 0.9 percent this year.
On Thursday, the ECB left its bond purchase program and interest rates unchanged, and Draghi reiterated during a press conference that the current levels of interest rates, Inflation remains dependent on central bank interventions.
The head of the central bank acknowledged that economic growth was "increasingly robust" in the euro area.
In the survey Friday, economists raised their expectations for growth in the single currency area to 1.7 percent, up from 1.5 percent in the latest poll.