ECB’s Centeno: Need Slowdown in Wages for March Projections to Materialise

22 March 2024

By Isabel Teles – FRANKFURT (Econostream) – European Central Bank Governing Council member Mário Centeno on Friday said that in order for the March macroeconomic projections to materialise, the current deceleration in wage growth was necessary.

In a press conference following the release of the latest Portuguese Economic Bulletin, Centeno, who heads Banco de Portugal, said, ‘[M]y personal reading is that this slowdown in wage growth in the euro area is an essential condition for all the economic forecast to materialise.’

There was ‘no doubt’ that an economy that did not grow but had a resilient labour market needed to ‘adjust something’, he said.

‘Because we cannot continue to not grow, to increase employment and to increase salaries, this is not an economy is sustainable’, he justified.

He said he would not anticipate any monetary policy decision, as some key data were still unavailable.

‘[W]e have to analyse the wage data, and when we meet at the beginning of April we can make decisions. But decisions are only made when we have all this information and there is still some time to get there’, he said.