Euro Area Watch: Forecast update: milder gas outlook, milder economic hit

研报英文原文证据摘录

Euro Area Watch: Forecast update: milder gas outlook, milder economic hit

Accessible version

Euro Area Watch

Forecast update: milder gas outlook, milder

economic hit

Revised EU TTF price outlook matters for the Euro area 19 May 2026 Corrected

We adjust our Euro area macro forecasts to incorporate our commodities strategists Economics

new, lower natural gas price forecasts (TTF) in our scenario. Reduced LNG supplies from Euro Area

Qatar have not led to the initially expected major rally in European natural gas prices BofA Euro Economics

into 2Q26, thanks mainly to mild temperatures, strong nuclear and renewable power BofA Europe (Madrid)

generation and fast growing North American LNG supplies. Our commodities strategists +44europeaneconomics@bofa.com20 7995 1476

lowered their TTF targets to €55/MWh for 2026 and €35/MWh for 2027, from €75/MWh Ruben Segura-Cayuela

and €50/MWh respectively (Global Energy Weekly: EU gas and carbon break up). Europe Economist

BofA Europe (Madrid)

Lower inflation peak, around c.3.3% in 3Q26 +34ruben.segura-cayuela@bofa.com91 514 3053

With these milder gas profile, our inflation forecasts move to 2.9% (-40bp) in 2026 and Evelyn Herrmann

1.9% (-20bp) in 2027, with core inflation at 2.2% and 2.1% (-10bp per year). The new EuropeBofASE Economist(France)

gas price profiles lower headline inflation via gas and electricity prices, but also core evelyn.herrmann@bofa.com

inflation via indirect effects. Second round effects via wage growth are more limited Chiara Angeloni

too, but we had assumed those to be quite small even under the previous energy price EuropeBofA EuropeEconomist(Milan)

assumptions. In this new base case, Euro area HICP peaks at c3.3% in late 3Q26 (vs c4% chiara.angeloni@bofa.com

in 4Q26 before) and falls below 2% again in the 2Q27.