Euro Area Wage Pressures Expected to Remain Stable Through Early 2027

The European Central Bank (ECB) has released its latest wage tracker data, showing that negotiated wage pressures in the euro area are expected to remain stable through early 2027. According to the data, the wage tracker currently stands at 2.3% for 2026, based on collective bargaining agreements available in early July.

Separate data from Cyprus shows that workers' earnings continued to rise in the first quarter of this year, although most employees earned below the national average.

The ECB's wage tracker extends its forward-looking horizon to March 2027 and projects a slight increase to 2.7% in the first quarter of next year. The central bank notes that newly signed agreements have not materially altered the outlook for the year, and that the tracker should not be interpreted as a forecast.

The data also highlights one-off payments, which are expected to play a limited role by the first quarter of 2027. The ECB refers to its negotiated wage growth indicator, which forecasts compensation per employee across the euro area to increase by 3.2% in 2026.