Key facts
- 40% of surveyed euro zone companies expect or see a risk of higher wage demands.
- Wage growth is projected to slow to 3.0% this year and 2.9% next year.
- 90% of consumer-facing firms reported only partial or limited pass-through of costs to selling prices.
FRANKFURT, Oct 30 (Reuters) - Euro zone companies are bracing for higher wage demands from their workers after a surge in the cost of living caused by the Iran war, a European Central Bank survey showed on Friday. The ECB, which kept interest rates steady on Thursday but hinted at a hike at its next meeting, is monitoring for signs that rising inflation is spreading to salaries. The survey of large euro zone companies revealed that 40% of respondents were expecting or seeing the risk of higher wage demands, a significant increase from 20% in the previous poll published in July. While overall wage growth is still projected to slow from 3.2% last year to 3.0% this year and 2.9% next year, the deceleration is expected to be more gradual than previously anticipated.