Average annual HICP inflation is projected to lie between 2.1% and 2.3% in 2004. As the impact of recent oil price increases and the effects of previous indirect tax and administered price rises gradually dissipate, annual HICP inflation is projected to be between 1.5% and 2.5% in 2005 and 1.0% and 2.2% in 2006.
These projections are broadly consistent with forecasts recently released by international and private sector organisations. BIS Review 73/2004  1  Several upside risks need to be taken into account. Concerns relate in particular to future oil price developments and, more generally, to the potential risk of second-round effects in wage and pricesetting throughout the economy.