Average inflation in the euro area (EA19) this year is expected to be 1.7 percent, the European Central Bank (ECB) said on Friday.
'The results of the ECB Survey of Professional Forecasters (SPF) for the third quarter of 2018 show average inflation expectations of 1.7 percent for each of the years 2018, 2019 and 2020,' the bank said.
The ECB noted that the results show upward revisions of 0.2 percentage points for this year and 0.1 percentage points for next year, but no change for 2020, compared to the previous SPF.
'In their qualitative comments, respondents typically attributed their upward revisions to higher oil prices, which had, to an extent, already been reflected in the most recent harmonized index of consumer prices (HICP) data,' the ECB said.
According to the EU's statistics office Eurostat, the annual inflation rate in the EA19 was 2 percent in June -- up from 1.3 percent in the same month last year -- while the highest contribution to the annual inflation rate came from energy, up 0.76 percentage points.
'Average longer-term inflation expectations (referred to 2023) remained stable at 1.9 percent,' the bank said.
The ECB noted that the total number of responses was 56 in this SPF, which is done on a quarterly basis and does not represent the bank's views.
The bank also said expectations for GDP growth in the EA19 averaged 2.2 percent for this year, 1.9 percent for next year, and 1.6 percent for 2020.
'Compared with the previous survey round, this implies downward revisions of 0.2 percentage points for 2018 and 0.1 percentage points for 2019,' the ECB said, adding:
'The average point forecasts for the unemployment rate were 8.3 percent, 7.9 percent and 7.6 percent for 2018, 2019 and 2020, respectively.'
According to Eurostat, the EA19 economy grew 2.2 percent in the first quarter of this year, compared to the same period of 2017, and the unemployment rate was 8.4 percent this May -- the lowest level since December 2008 -- down from 9.2 percent in May 2017.
By Muhammed Ali Gurtas