Lagarde: Wages to be key component of inflationary pressures
European Central Bank (ECB) President Christine Lagarde on Thursday underscored that wages represent an important aspect of inflation, which will be a significant element of underlying inflationary pressures in the months ahead.
"Wages play a critical component in the services sector, which is far more labor intensive," Lagarde stressed, adding that the central bank will continue to closely monitor the dynamic of wages across the euro area. "Underlying inflation pressures, fiscal measures, and wages all warrant 50 basis point hike in March," she added.
Lagarde underlined that there is still "ground to cover" in her remarks at the press conference that followed the central bank's policy meeting, stressing that the peak interest rate has not yet been reached. "I can't think of scenarios where a 50 basis point hike would not happen unless they are quite extreme," Lagarde stated.