Bundesbank economic forecast: setbacks expected for the economy

Despite a series of interest rate hikes by the European Central Bank (ECB) and falling energy prices, there is still no all-clear on the cost of living this year. However, the Bundesbank lowered its inflation forecast for 2023 to 6.0 (7.2) percent. In the following year, she expects inflation to fall to 3.1 (4.1) percent. For 2025, it estimates an inflation rate of 2.7 (2.8) percent. This means that inflation would still be well above the target of 2.0 percent in two years’ time ECB as optimal for the economy in the euro area.