<ul><li style=““ class=“text-align-justify“>Inflation is expected to decline from an average of 8.4% in 2022 to 6.3% in 2023</li><li style=““ class=“text-align-justify“>Inflation is then expected to decline to an average of 3.4% in 2024 and of 2.3% in 2025</li><li style=““ class=“text-align-justify“>Headline inflation is expected to fall to the ECB’s medium-term inflation target of 2% in the second half of 2025</li><li style=““ class=“text-align-justify“>But HICP inflation excluding energy and food will remain above 2% throughout the horizon</li><li style=““ class=“text-align-justify“>Risks to the economic growth outlook are on the downside, especially in the near-term</li><li style=““ class=“text-align-justify“>The risks to the inflation outlook are primarily on the upside</li><li style=““ class=“text-align-justify“>Tighter financing conditions would mitigate the build-up of financial vulnerabilities and lower tail risks to <a target=“_blank“ href=“https://www.forexlive.com/terms/i/inflation/“ target=“_blank“ id=“ad51a5a2-1afc-4f42-9e62-ea6faf6f90fa_7″ class=“terms__main-term“>inflation</a> over the medium-term</li><li style=““ class=“text-align-justify“>Interest rates will still have to rise significantly at a steady pace to reach levels that are sufficiently restrictive to ensure a timely return of inflation to the 2% medium-term target</li><li style=““ class=“text-align-justify“><a target=“_blank“ href=“https://www.ecb.europa.eu/pub/economic-bulletin/html/eb202208.en.html“ target=“_blank“ rel=“nofollow“>Full release</a></li></ul><p style=““ class=“text-align-justify“>There’s nothing new here as this is mostly a capsule of views held by the ECB and policymakers have put out such remarks over the course of the past few months already.</p>

This article was written by Justin Low at www.forexlive.com.