ECB December Forecasts: 2022 HICP inflation seen at 3.2% versus prior 1.7% forecast

The new ECB staff economic projections for December were recently released in wake of the ECB's latest monetary policy decision. The bank now forecasts HICP inflation of 2.6% in 2021 (versus prior forecast of 2.2%), of 3.2% in 2022 (versus prior forecast of 1.7%), of 1.8% in 2023 (versus prior forecast of 1.5%), while the inflation forecast for 2024 was left unchanged at 1.8%. 

Meanwhile, the ECB forecasts that GDP will grow 5.1% in 2021 (versus prior forecast of 5.0%), at a pace of 4.2% in 2022 (versus prior forecast of 4.6%), at a pace of 2.9% in 2023 (versus prior forecast of 2.1%) and then at a pace of 1.6% in 2024, which was unchanged from the prior estimate.