News from the Financial Associated Press, January 3 (edited by Shi Zhengcheng)According to data released by the German Federal Statistical Office on Monday (January 2), the country’s employment data in 2022 will continue to rise and set a new high after the reunification of Germany in 1990. Since this scene of “inflation plus job market tension” has been staged in the United States, it has further deepened the European Central Bank’s concerns about more aggressive interest rate hikes.
(German employment data reached a new high since 1990, source: Destatis) The German statistics department said,In 2022, the number of employed people in Germany will reach 45.6 million, an increase of 589,000 from the previous year, which is 292,000 higher than the previous extreme value in 2019. At the same time, the unemployment rate in Germany has also dropped to 2.8%, which is also a record low .Of course, this data itself is hardly surprising. According to the latest data at hand, the unemployment rate of 6.5% in the euro zone in October last year was also a new low since statistics were available.
(Eurozone unemployment rate, source: EuroStat) The S&P Global Germany PMI Index also released on Monday also showed that although the output of German manufacturing companies declined in December, they continued to absorb employment steadily. Under the shadow of economic recession, the scene of the hot job market is vivid on the paper. Of course, similar to the US, a tight job market means stronger wages for workers and a more unpredictable inflation picture.
ING economist Bert Colijn told the media that he predictedThe labor market in the euro zone will remain tight even against the backdrop of a recession, with firms set to keep employees on hand to ensure they are available after the downturn is over, so there will be continued “moderate upward pressure” on wages.
According to the investigation report released by the EU in December last year,Two-fifths of German companies reported labor shortages in the fourth quarter of last year, and the record high for this figure was in the third quarter of last year. At the level of the entire euro area, the proportion of companies reporting that they cannot recruit people is as high as 30%.
Given that the inflation rate in Europe was still as high as 10.1% in November last year, it was only slightly lower than the historical extreme value of the previous month. Therefore, the market generally expects that the European Central Bank will continue to raise interest rates by 50 basis points at the policy meeting on February 2, raising the benchmark deposit rate to 2.5%.
At the European Central Bank meeting last month, President Lagarde pointed out that the trend of wage growth across the euro zone is still strengthening, with a strong job market and compensatory wage increases triggered by high inflation becoming the main boosting factors.
Lagarde also added that the ECB forecasts that wage growth will continue to be higher than the historical average, causing inflation to fall back to the inflation target (2%) until at least 2025.
This Friday (January 6) Eurostat will release inflation data for December last year. According to the current survey of economists,While the most eye-catching CPI data is likely to retreat to single digits, core inflation data, which reflects underlying price pressures, will remain at a record high of 5%.