All articles tagged with #wage price spiral
European Central Bank (ECB) President, Christine Lagarde, has said that the ECB must persist with high interest rates to prevent a wage-price spiral and curb inflation. She added that the ECB's current monetary policy stance is appropriate and that the central bank will continue to monitor the situation closely.
Bank of England Governor Andrew Bailey warns that the UK is experiencing a wage-price spiral, with domestic wage growth and price setting contributing to the persistence of inflation. This situation risks perpetuating "second-round effects," where workers demand higher wages to afford goods and services, leading to higher demand and pushing companies to raise prices. The UK inflation rate held above 10% in March, with core inflation steady at 5.7%. The Bank of England's monetary policy committee will continue to adjust its main bank rate "as necessary" to reach its 2% inflation target.