by Wolf Richter
Wolf Street
Meanwhile, the ECB’s QT marches on, balance sheet has shed €2.45 trillion since the peak, or 59% of its pandemic QE.
The ECB’s own measure of wage increases, its index of “Negotiated Wages,” is based on collective bargaining agreements after they were negotiated between employers and organizations that represent workers. It’s a forward-looking measure, reflecting wage increases that are going to be implemented soon. “Negotiated wages” cover about two-thirds of the Euro Area economy. These “negotiated wages” exclude bonuses, overtime, and other individual compensation that is not linked to collective bargaining.
And it blew a fuse today. In Q3, “negotiated wages” spiked by 5.4% year-over-year, according to the ECB today, after the false-hope deceleration in Q2.