ECB President Christine Lagarde told the IMFC annual meeting that the global economy has been surprisingly resilient despite the Middle East conflict, energy swings and trade tensions. ECB staff project euro area growth of 0.9% in 2026, 1.4% in 2027 and 1.5% in 2028, with risks tilted to the downside. Headline inflation rose to 3.8% in September, driven mainly by energy, while core inflation edged up to 2.5%; it is expected to stay well above target into the first half of 2027 and return to around target by late 2027. The ECB raised key rates by 25 basis points in September after a same-sized increase in June, and inflation risks are seen tilted to the upside.
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