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2021/05/07 / Erste Group Research

What does the labor market say about the inflation outlook?

At first glance, the situation on the labor market in the Eurozone has only deteriorated slightly as a result of the Covid-crisis. However, generous short-time work programs in many Eurozone countries have significantly dampened this increase.

Without short-time work programmes, there would currently be a significant oversupply of labor in the Eurozone labour market. The significant underutilisation of the labor market and the associated low wage pressure will also dampen general price pressures and thus continue to result in an expansionary orientation of ECB monetary policy.

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General information

AuthorErste Group Research
Product nameWeek ahead
Topic in focusMacro/ Fixed income
Economy in focusEurozone, United States
Currency in focusEuro, US Dollar
Sector in focus-


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