SURVEY results published by the European Central Bank (ECB) on Friday showed that many professional forecasters had revised down eurozone’s annual inflation and gross domestic product (GDP) growth expectations, particularly for 2020.

According to the quarterly conducted ECB Survey of Professional Forecasters (SPF), forecasts for the annual HICP (Harmonized Index of Consumer Prices) inflation averaged at 1.2 percent for 2019 and 2020 and 1.4 percent for 2021, down from 1.3 percent, 1.4 percent and 1.5 percent in the previous round of survey.

The results marked downward revisions for the fourth successive round, the ECB said, which were mainly attributed to lower oil prices, lower-than-expected actual inflation and worsened economic outlook.

SPF respondents also revised down expectations for growth in euro area real GDP to 1.1 percent, 1.0 percent and 1.3 percent for 2019, 2020 and 2021, respectively. The new projection for 2020 GDP growth was notably lower than the projection of 1.3 percent in the previous round of survey.

In terms of risk assessment, the trade conflict between the United States and China, and a possible increase of tariffs on car imports from the European Union continued to be the most cited downside risks.

On the domestic side, some respondents saw a risk of a continued weakness of the automotive industry and a risk of the current weakness in the European manufacturing sector spilling over to domestic demand.

Nevertheless, longer-term inflation and long-term GDP growth expectations remained unchanged at 1.7 percent and 1.4 percent.

Additionally, average unemployment rate expectations were revised up by 0.1 percentage points for horizons beyond 2020, pointing to a longer-term rate of 7.4 percent.

The ECB on Thursday decided to keep key interest rates unchanged following its monetary policy meeting, but ECB President Mario Draghi noted “the risks surrounding the euro area growth outlook remain on the downside.”

The Eurozone manufacturing purchasing managers’ index (PMI), produced by IHS Markit, stands at 45.7 in October, unchanged from the previous month and missing market forecast of 46, a preliminary estimate showed.

Output dropped for a ninth straight month. Still, the rate of decline was marginally weaker than in September, indicating that the goods-producing sector remained in its deepest downturn since 2012, as new orders and exports continued to shrink.

Also, employment fell to the sharpest pace since the start of 2013.

(SD-Xinhua)