ECB's Optimistic Inflation Outlook

The European Central Bank (ECB) has recently shared an optimistic update regarding inflation, predicting a return to target levels by the first half of 2025. This forecast comes from the minutes of the council's meeting held on December 11 and 12 last year.

Earlier Achievement Than Previously Projected

Members of the council expressed increasing confidence that inflation would reach the desired outcome sooner than the previous projections suggested. Specifically, rates around 2% are expected to be achieved by the second quarter of 2025. However, it was noted that near-term inflation might be lower than what was projected in September 2024.

Vigilance Advised in Final Disinflation Phase

Despite the positive outlook, the ECB warns that the Governing Council must remain vigilant during the final phase of disinflation. This caution is due to some assumptions behind the projections still needing confirmation through concrete data.