Central Banks
ECB’s Wage Tracker Points to Steep Slowdown This Year
- Pay to rise 1.5% y/y in 4Q 2025, down from 5.3% in 4Q 2024
- Economists differ significantly on outlook for wages
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The European Central Bank’s main gauge of future euro-zone pay growth continued to signal a sharp slowdown in 2025, underpinning hopes for a further retreat in inflation that should allow more interest-rate cuts.
The ECB’s wage tracker, published Wednesday, predicts salaries rising by an annual 1.5% in the fourth quarter of 2025. While that’s up a touch from the 1.4% projection seen in December, it’s way down from the 5.3% peak recorded a year earlier.