European Central Bank policymakers expect it to raise its short-term inflation forecasts next month as uncertainty persists about how quickly the central bank will need to respond to surging prices.
The ECB has consistently underestimated how fast eurozone inflation would rise this year as the economy rebounded from the coronavirus pandemic. Members of the central bank’s governing council said they expected it to raise its 2022 forecast again in December, according to the minutes of its October meeting, published on Thursday.
But council members agreed there was “elevated” uncertainty over the outlook for price growth in 2023 and 2024, which is one of the main yardsticks that the central bank will use to calibrate bond purchases and interest rates next year.