\u0022Once inflation is high, the pressure from wages is here,\u0022 U.S. Treasury Secretary Larry Summers warned. Read more.
Inflation peaked in double digits across much of the industrialized world but is expected to drop rapidly this year on the back of falling energy and commodity prices. However, core inflation will remain elevated as wage behaviour and companies’ price setting has fundamentally changed, Swiss National Bank Chairman Thomas Jordan said on the same panel.Article content
“It will be much more difficult to bring inflation from four per cent to two per cent,” he said. “We will see if that comes with a recession or not. Firms do not hesitate any more to increase their prices. That is different from two or three years ago and is a signal that it is not that easy to bring inflation back to two per cent.”
“We also see a change in the behaviour regarding wages. If you look at wage formation, this is very backward looking. Basically we take inflation from last year and we use this to set future salaries – the kind of fairness argument. Once inflation is high, the pressure from wages is here.” Summers warned: “It would be a grave error for central banks to revise their inflation target upwards at this point. Having failed to attain the two per cent target and having re-emphasized repeatedly the commitment to two per cent, to then abandon the target would do very substantial damage to credibility. If you can adjust once, you can adjust again.”Article content
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
'Major concerns' were flagged in Indian boarding home system for years, records show | CBC NewsA concerned letter from a United Church committee in British Columbia, bearing the minister’s office stamp, raised issues with the boarding homes program in 1967.
Read more »
Who was Edward Brezinski? ‘Make Me Famous’ documentary explores artistEdward Brezinski was a New York painter who was intense, ambitious and clever but went unacknowledged. Now, he is the topic of a documentary called “Make Me Famous,” which is making its Canadian premiere Friday at Hot Docs.
Read more »
In memory: Howard Lloyd, former MLA, Prince George city councillorHoward Lloyd was a former Prince George city councillor, regional director and MLA for the Fort George Riding in the 1970s. He passed away Dec. 27, 2022.
Read more »
Disappearing glaciers in B.C. put tourism, watersheds at risk: scientist - Terrace StandardBrian Menounos predicts most glaciers will disappear but warns against inaction
Read more »
Today's letters: Let's discuss biodiversity in urban areasFriday, Jan. 20: Cities can protect their green space, but it\u0027s complicated, warns one reader.
Read more »
THIN ICE: NCC warns skaters to keep off Rideau Canal\u0022The presence of work crews on the canal in the coming days must not be construed as a sign that the ice surface is stable,\u0022 the NCC said.
Read more »