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Analysts attribute big August wage rise to one-off effects

A bigger than expected rise in wages in August was probably caused by calendar-year effects and is not a sign of wage-side inflationary pressure, analysts told MTI on Tuesday after the Central Statistics Office (KSH) published fresh data.

Gross wages rose 6.5% year-on-year in August, KSH said in the morning. Net wages were up 6.8%.

Wages rose faster than expected in August, but the fact the month had two more work days than a year ago probably explains some of the increase, said Takarékbank’s Gergely Suppan. He put year-on-year wage growth around 4.5% for the rest of the year, but said the increase would not put consumption on the growth path because of high repayments on foreign currency-denominated loans and caution among households.

Erste's Zoltán Árokszállási also said the big wage increase does not show wage-side inflationary pressure because it was probably the result of fewer workdays in the base period. Wage growth or employment is unlikely to pick up in the coming months because of the worsening economic outlook this year. A big increase in the minimum wage planned for next year could raise wages overall but could adversely affect employment, he added.