Economists surveyed by the European Central Bank (ECB) have slightly raised their forecasts for eurozone inflation, the bank said in its November bulletin. Experts taking part in the Survey of Professional Forecasters raised their forecast for 2003 inflation to 2.0pc from 1.9pc and raised the 2004 and 2005 outlook by one percentage point to 1.6pc and 1.8pc, respectively. ECB president Jean-Claude Trichet said last week that he expected inflation to remain "sticky" in the near term, but to fall to levels in line with the bank's price stability definition - below or close to 2pc - in the medium term.
The survey participants said upside risks included possible higher oil prices and a rise in food prices due to the hot summer. The forecasters also cut their outlook for 2003 economic growth to 0.5pc from 0.7pc, but maintained their projections for 2004 and 2005 at 1.7pc and 2.3pc, respectively. Figures this morning showed that Germany and France, the eurozone's largest economies, pulled out of recession in the third quarter, recording growth of 0.2pc and 0.4pc, respectively. The euro rose following the announcements, climbing 0.50pc USD1.1685. //www.fxcentre.com