EZ wages

It looks like the spillover impact from the hotter wages from Germany is telling here. The Q1 negotiated wages data now reflects a growth of 4.7% year-on-year, which is higher than that in Q4 last year of 4.5% year-on-year. This isn't too helpful of a development for the ECB but policymakers will still go through with a June rate cut surely. However, this is likely to put them off from considering a July move at the very least.

One can argue that the German spillover is a one-off, amid a delayed call to action to raise wages there against inflation. But the ECB can only work with the data it has in front of it. And they will only be more certain about things when we get to the Q2 data.

That means while there is still the expectation that wages should ease later in the year, the ECB might only be able to signal its next move in September at the earliest.