ECB’s Lane says rising wages underpinning euro zone inflation

October 4, 2023

Rising wages in the euro zone are underpinning inflation in the bloc but wage growth should moderate in the coming months, the European Central Bank’s chief economist Philip Lane said today.

Professor Lane told an event in the Lithuanian capital Vilnius that the ECB will only know around Easter next year if wage growth is indeed coming down as it expects.

He told reporters he welcomed last week’s news that euro zone inflation had fallen in September to its lowest level in two years, but said monitoring further progress would be needed.

“We do assess that wage inflation will come down, but it’s going to take months, it will take time. So what we saw in September is welcome, but we need to see further progress,” Lane said.

“For services inflation, I welcome September (data), but I think we will be looking at services inflation data for quite a while,” he added.

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