FRANKFURT: Financial experts in the European Union have lowered their inflation expectations for the coming years, a European Central Bank (ECB) survey published on Friday showed, reflecting the institution’s complicated path to its price stability target.

In its quarterly survey of professional forecasters, the ECB found average price growth predictions had been revised down 0.1 percentage points for 2017, 2018 and 2019.

Forecasters now expect inflation to reach 1.5 per cent this year, followed by 1.4pc next year and 1.6pc in 2019.

The latest survey results are largely in line with the ECB’s own predictions, although central bank staff expects inflation to slow slightly in 2018 to 1.3pc.

ECB policymakers use the central bank’s powers to try and hold inflation at its target of close to, but below 2.0pc – the level believed to be most favourable to growth.

That pattern was reflected in Friday’s survey, with forecasters upping their growth predictions for the coming years even as they saw rate of inflation turning out lower.

The private-sector experts match the ECB’s expectations for 1.9pc growth this year and 1.8pc in 2018, but remain slightly less confident for 2019 with a 1.6pc prediction – 0.1 percentage points lower than the central bankers.

Published in Dawn, July 22nd, 2017