Inflation is set to persist for longer than initially expected, according to National Institute for Statistics and Economic Studies (STATEC), which has revised its spring projections in its latest forecasts.
High energy prices are here to stay for some time. STATEC expects inflation in the eurozone to remain elevated for longer, and does not see it returning to 2% until 2028.
In October, Luxembourg’s inflation rate stood at 2.7%.
The support measures extended during the tripartite negotiations are helping to keep inflation in check.
Next year, they are expected to reduce inflation by around 0.7 percentage points, which could prevent an additional wage indexation.
Under STATEC's central scenario, inflation is projected to stabilise at 2.5% over the next two years. However, depending on how energy prices develop, it could range anywhere between 2 and 3%.
The timing of the next wage indexation depends on how prices develop.
STATEC currently expects one in the second quarter of next year and another in the second quarter of 2028. The most recent indexation took place in June this year.
The latest forecasts are available on the STATEC website.
