Washington, Nov. 02 (SANA) Economists have raised their inflation forecasts for the euro zone in 2026 and 2027, warning that the fallout from the war in the Middle East could prolong price pressures by driving up energy, transport and production costs.
According to CNN, a European Central Bank (ECB) survey released on Sunday showed that average inflation expectations had risen to 3% for 2026 and 2.6% for 2027, up from the lower projections in the previous survey. Inflation is expected to return to the ECB’s 2% target in 2028.
Survey participants warned that continued disruptions to oil and gas markets could increase shipping, insurance and supply chain costs, pushing up prices for goods and services across the euro zone. They estimated that the economic effects of the crisis could persist for between 10 and 24 months.
At the same time, economists expect modest economic growth across the currency bloc, complicating the task of policymakers seeking to contain inflation without undermining economic activity.
The European Union remains heavily dependent on stable global energy markets, leaving its economies vulnerable to geopolitical disruptions in the Middle East, a major global hub for oil and gas production and exports.
Europe has faced successive periods of high inflation in recent years, driven in part by energy market volatility and supply chain disruptions. These pressures prompted the European Central Bank to tighten monetary policy and raise interest rates to curb rising prices.
I.Z/RK
