According to Jinshi Data, IFR market analyst Divyang Shah said that the third quarter wage data released by the European Central Bank showed a year-on-year increase of 5.4%, higher than the previous two quarters. Shah pointed out that this increase was mainly affected by Germany and one-time bonuses, and it is unlikely to be repeated in the future.
The ECB prefers its forward-looking wage tracker, which predicts a sharp slowdown in wages in 2025. The minutes of the October meeting showed that the wage tracker pointed to slower wage growth in 2025, and survey data pointed to a deceleration in wage growth over the coming year.
The third-quarter wage data is not expected to change the ECB's policy outlook. The ECB is inclined to cut interest rates by 25 basis points at each meeting until at least June 2025, with the deposit rate falling from 3.25% to 2.00%.