The price-wage spiral is no longer spinning
16:30
The average salary across the national economy was 11.8 percent higher in the second quarter than a year earlier. At the same time, inflation stood at 13.9 percent. Wage growth is no longer keeping pace with price increases. This is the first such case in 10 years.
According to the latest GUS data, the average monthly salary for April, May, and June this year was just over PLN 6,156. A year earlier, it was just over PLN 5,504.
The GUS report is another argument for those members of the Monetary Policy Council who no longer wish to raise interest rates. Or clearly limit their scope. Because they prove it clearly: the price and wage spiral that was so feared has stopped spinning.
Whether such labor market data should be treated as a recessionary phenomenon is another matter. Certainly, the real fall in wages (because that is what they amount to) may have an impact on the rate of consumption. But on the other hand, unemployment is at a record low and wages are nominally growing at a double-digit rate.
