EUROPEAN INFLATION: Analysts Update HICP Forecasts
Jun-27 14:47
Analysts give additional commentary on their Eurozone and country-wide HICP data forecasts after this morning's data (France, Spain, Belgium):
- ABN Amro: "Dutch inflation is expected to ease only slightly to 3.2% y/y from 3.3% in May. Amid a broader slow disinflationary trend it is an upward effect from energy prices and high food price inflation that continue to exert upward pressure, distorted slightly by the fading upward effect from VAT-changes. Zooming out, Dutch inflation is expected to continue outpacing eurozone inflation in the coming quarters.
- That ABN Amro forecast comes amid GS seeing HICP 3.1% headline and 2.8% core, while Barclays sees HICP 3.03% headline and 2.93% core. No consensus estimate exists yet for the June (HICP) print in the country.
- Bank of America: "We expect June HICP inflation at 2.2% in Germany, 1.9% in Italy (Mon), and 2.0% in the Euro area with core at 2.2% (Tue). Note that this temporary increase in headline inflation numbers is due to the spike in oil and it should correct in July."
- "We expect slightly stronger headline and core in 2025 and 2026. We forecast headline inflation of 1.8% (+10bp), 1.5% (+10bp) and 1.8% in 2025, 2026 and 2027, respectively. We still expect a small core inflation undershoot throughout, starting in the last part of this year, with yearly averages of 2.1%, 1.8% and 1.8% in 2025, 2026 and 2027.
- Goldman Sachs: "Taking the French and Spanish national data into account, we upgrade our Euro area headline inflation forecast for June slightly to 2.03%yoy (from 2.0% previously), and revise our core forecast up by 1bp to 2.34%yoy. This would imply a seasonally adjusted sequential core inflation pace of 0.26%mom in June on our bottom-up seasonal adjustment methodology approach"
- TD Securities: "We expect inflation in Germany and euro area to move largely sideways in Jun. Continuing deflation in energy prices is likely to be balanced by upward pressures in food, bringing the headline measure up a tick. We expect service inflation dynamics to return to normal after Apr/May Easter distortions, keeping euro area core inflation at 2.3% y/y."
- They see Germany headline at 2.1%, and Euro area headline at 2.0% in June.
For our full preview of June's Eurozone inflation round, see here.
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