In addition, over the past few months supply chain bottlenecks have eased and freight costs have declined sharply. 2 Slower growth, the recent correction in energy commodity prices and the improvements in global supply chains will help ease inflation. However, according to our forecast, inflation will stay above the target for an extended period. And, more generally, the longer inflation stays at high levels, the greater the risk of a de-anchoring of inflation expectations or the materialisation of second round effects through wages or mark-ups. On the basis of the inflation outlook I have just outlined, after ending the net purchases under the PEPP in March and those of APP in July and the 50 basis points (bp) and 75 bp rate increases in July and September, respectively, we decided in October to implement another major policy rate increase of 75 bp. We also decided to adjust the interest rates applicable to our Targeted Longer-term Refinancing Operations (TLTRO III) from 23 November 2022 and to offer banks additional voluntary early repayment dates, with a view to reinforcing the transmission of our policy rate increases to bank lending conditions. Both measures are aimed at containing aggregate demand and guarding against the risk of a persistent upward shift in inflation expectations. These decisions were clearly in line with analysts’ expectations. In particular, the latest ECB Survey of Monetary Analysts (SMA) foresaw a 75 bp increase in the deposit facility rate (DFR) at the October meeting.
The median SMA respondent also anticipated euro area inflation returning to 2% at the end of 2024. Therefore, our October decision was consistent with market analysts’ expectations of a policy rate path whereby inflation is expected to return to target by the end of our medium-term projection horizon. 3  2  See Burriel, Kataryniuk, Mo reno and Viani (2022), “A new supply bo ttlenecks index based o n newspaper data”, Working Paper, Banco de España (fo rthco ming). 3  Surveys by Blo o mberg and Reuters befo re o ur Octo ber meeting po inted to similar co nclusions. However, the latest Survey o f Pro fessional Fo recasters (SPF) pro jected an inflatio n rate o f 2.4% in 2024, mo re in li ne with the ECB’s September fo recast. 2  With the recent interest rate hikes, we have made substantial progress in withdrawing monetary policy accommodation. Since July, we have raised interest rates by 200 bp – the fastest increase in the history of the euro. But we are not done yet. We will need to move rates to levels that allow inflation to converge to our 2% medium-term objective. And for this, we still have some way to go. 4 However, given the high degree of uncertainty of the inflation and economic outlook, the specific level that interest rates may have to reach to be consistent with this objective is uncertain, as it is entirely data-dependent and may change over time.