Eurozone wage growth sinks, supporting further ECB easing

European Central Back widely expected to cut rates for an eighth time this cycle when it meets next month

Negotiated wages rose 2.4% from a year ago in the first quarter, the ECB said Friday. That is down from 4.1% in the final three months of 2024. Picture: Daniel Roland / AFP via Getty Images

A key measure of euro area pay growth plunged, supporting the European Central Bank’s claim inflation will soon hit the 2% target and backing calls to lower interest rates further.

Negotiated wages rose 2.4% from a year ago in the first quarter, the ECB said Friday. That is down from 4.1% in the final three months of 2024 and less than half the 5.4% peak recorded last year.