Tuesday, May 17

Record inflation expected for 2022: “The indexation of wages is not sufficient to cover it”

Energy prices which continue to drive up inflation. According to the Federal Planning Bureau, it should even exceed 6 percent at the start of the year. It’s a record increase, we haven’t seen this since the 1980s. So what are the consequences, and until when will it last?

These breads are on average 5% more expensive, a price increase as visible as for other food products. In this other brand, shelves and sofas are now 9% more expensive. And at home, the energy bill increases further: +201 euros in electricity and over 846 euros in gas on average for a variable contract. Sign of high inflation, it should exceed 6% at least until April. Unheard of for 40 years. And the consequences are there for consumers.

“For workers, there is a loss of purchasing power. Fortunately, we have what is called wage indexation which automatically increases wages with inflation. cover inflation “, explains Bruno Colmant, economist.

According to social allowances could again be indexed in March and civil service salaries in April. A significant cost for companies, which must reduce their margins for beneficiaries.

“Some of them which are subject to international competition with neighboring countries where companies have not had this automatic indexation of wages. In a whole series of sectors in which the intensity of labor is important, these companies will see their competitive position weakened “, says Bruno Wattenbergh, expert in economics.

How long will this inflation last? Economists are divided. “My intuition is that we started with inflation which is perhaps 5.6% next year, which will be around 3.4% the following years”, valued Bruno Colmant.

“We have fears. It is too early to confirm that it could settle down. In any case, if it does settle down. It will have consequences, it will create tensions”, explains Bruno Wattenbergh. No solution to reduce this inflation. Everything will depend on energy products and their price cannot be blocked by the authorities.

Reference-www.rtl.be

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