Germany’s IG Metall, representing some 3.6 million manufacturing workers, is demanding an 8% pay hike next year, the highest in 16 years. Meanwhile the employers’ association has countered with an offer of 2.1%. As a result the union has threatened a series of warning strikes which look likely to commence overnight. Will the spectre of possible wage inflation in Germany cause the ECB to hold fire on an early rate cut, most probably not. There are bigger fish to fry at the present time, namely a rapidly cooling euro-zone economy.
Meanwhile, EUR/USD has edged up to 1.2745 at writing in relatively orderly trading conditions.
