Next wage indexation is fast approaching, predicts Statec

Inflation rates are expected to slow down, and wage rises are just around the corner - both indicators that the next index is steadily approaching. If inflation rates continue to decrease, a second index could be triggered before next summer.

In its latest report, the statistics institute confirms an inflation forecast at 3.9% in 2023 and 2.5% in 2024. A figure close to that targeted by the European Central Bank.

And yet the opposite is true: prices of petroleum products have fallen, but so-called core inflation (excluding petroleum products, editor's note) has risen by 4.5%.

Statec: Annual inflation rate increases from 3.2% to 3.7%, as CPI drops by half percent

Food prices have fallen for the first time in two years: -0.1% in July compared with June. But services in particular are more expensive following the application of the first two indexes for 2023.

The third index is scheduled for September, writes Statec, provided that overall inflation remains at or above 4.1% in August. In any event, it will result in a 2.5% rise in wages and pensions.

Another indexation in 2024?

Depending on inflation, Statec foresees two possible scenarios. The worst-case scenario anticipates an indexation in October 2023, but not in 2024. The best-case scenario, however, would see two upcoming indexations: one in September 2023, and a second one in the second quarter of 2024.