Global Macro Service > Research Briefings > Global

Wages still do not pose a major threat to inflation

Wage growth in the advanced economies has recently risen to multi-year highs, a sign that diminishing labour market slack may be strengthening workers’ negotiating positions in pay deals. While we see further moderate rises in wage growth as likely, we remain sanguine about the risks that this poses to inflation.

After all, the recent rise in wage growth has by and large not overshot our own expectations or those of other forecasters. Meanwhile, real wage growth has been weaker than overall productivity growth and labour’s share of income actually fell slightly last year.

To read the full briefing please
If you are not a subscriber, request a free trial of our Global Macro Service by filling out the form below