Bundesbank chief sees upside risks to inflation

FRANKFURT (Reuters) – As Europe’s labour markets tighten, workers will be increasingly in a position to demand higher wages, raising the risk of persistently high inflation, Bundesbank President Jens Weidmann said on Wednesday.

“Companies’ complaints about labour shortages have increased significantly, particularly in Germany, but also among our European neighbours,” Weidmann said.

“In the future, such tensions on the labour markets could make it easier for employees and trade unions to push through noticeably higher wages,” he said, warning that upside risks to inflation dominate.

(Reporting by Balazs Koranyi; Editing by Alison Williams)