During the last meeting of the ECB Governing Council, held in March, the importance of the new macroeconomic projections prepared by the staff was highlighted. These projections, together with a series of data and information that will be available by the next meeting in June, are crucial to better understand wage dynamics.
It was also noted that information arriving before the April meeting will be limited, thus complicating the assessment of the sustainability of the disinflation process. The minutes of the March meeting, now accessible to the public, reveal that uncertainties persist among governors, especially regarding the sustainability of disinflation, particularly in services and domestic inflation.
These concerns are fueled by uncertain prospects for wage growth, increased productivity and profit margins. To strengthen confidence in a sustainable return of inflation to its target, it is essential that future data confirm the assumptions and forecasts underlying the March projections made by ECB staff.