MNI BRIEF: EC Puts ETS2 Inflation Impact At +0.3pp

The European Commission estimates the launch of the ETS2 emissions trading system in 2027 would boost eurozone inflation by 0.30 percentage points to 2%, Economy Commissioner Valdis Dombrovskis said today. 

Dombrovskis noted that the end-October cut-off date for the EC’s projections had, however, prevented the inclusion of the decision of EU states on Nov 5 to delay the launch until 2028. (See MNI: EC Autumn Inflation Forecast To Assume Mitigated ETS2)

"Should ETS2 be postponed until 2028, as seems to be the case, it would lead to the adjustment being postponed until 2028," Dombrovskis said. 

The Commission forecast eurozone inflation would fall to 2% in 2027, including the impact of the ETS2 launch.