ECB's Lane
ECB's Lane

Main comment:

In terms of an overall evaluation of our policy trajectory, we need to be further along in the disinflation process before we can be sufficiently confident that inflation will hit the target in a timely manner and settle at target sustainably.


  • The incoming data suggest that the process of disinflation in the near term in fact may run faster than previously expected, although the implications for medium-term inflation are less clear
  • monetary policy needs to carefully balance the risk of overtightening by keeping rates too high for too long against the risk of prematurely moving away from the hold-steady position that we have been in since September.
  • Many wage agreements will be renewed in the early months of 2024, and updates to the wage trackers will provide essential information in projecting wage dynamics
  • The available survey indicators are broadly consistent with the decreasing wage profile foreseen in the latest Eurosystem staff projections
  • According to our most recent discussions with large European non-financial corporations, the wage growth expectations of this set of companies for 2024 are 4.4 percent on average, which is a marked easing compared to the average 2023 wage growth of 5.3 per cent

What the ECB is watching:

eurozone wage growth