Economists Expect Inflation to Remain High Worldwide
Economic experts from around the world expect inflation rates to remain high, finds the Economic Experts Survey, a quarterly survey conducted by the ifo Institute and the Swiss Economic Policy Institute. According to this survey, the inflation rate worldwide will reach 7 percent this year, then 5.9 percent next year, and 5 percent in 2026. “Expectations for 2023 are almost identical to those expressed in the survey at the beginning of the year. For next year and 2026, inflation expectations have actually increased somewhat,” says ifo researcher Niklas Potrafke. “Inflation will remain at a very high level.”
Inflation expectations for 2023 are well below the worldwide average in several regions: in Western Europe (5.3 percent), North America (5 percent), and Southeast Asia (5.1 percent). “The ECB’s interest rate hikes also contributed to the decline in inflation expectations in Europe,” Potrafke says.
In contrast, inflation expectations are particularly high in South Asia (22.5 percent), South America (46.1 percent), North Africa (32.7 percent), and East Africa (29.9 percent). The March survey had 1,572 participants from 136 countries.
The figure shows the expected inflation rates on a global average for the years 2023 (7%), 2024 (5.9%) and 2026 (5%). The median of the averages at country level is shown.
Economic Experts Survey: Inflation Remains High Worldwide (Q1 2023)
How are economists’ expectations for future price developments evolving worldwide? Are the central banks’ sizeable interest rate hikes having an impact, and can we observe a decline in inflation expectations? The latest wave of the Economic Expert Survey (EES) conducted by the ifo Institute and the Swiss Economic Policy Institute examines economists’ inflation expectations at the global level. The result: high inflation rates are still expected worldwide. It is true that the expected inflation rate for 2023 has slowly declined over the past three quarters. However, there have been no noticeable changes compared with the last wave of the EES survey (Q4 2022).
