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Gross wages up 15.2 percent in April

The average gross wage in Hungary grew by an annual 15.2 percent to 507,500 forints (EUR 1,265) in April, the Central Statistical Office (KSH) said on Friday. The data for full-timers at businesses with at least five people on payroll show the average net wage rose at the same clip to 337,500 forints, while the gross median wage increased 14.3 percent to 396,800 forints.

Hungary’s statutory minimum wage was raised by more than 19 percent from the start of the year, while the salaries of many people employed in the public sector also increased, putting wage growth in the double digits from January.

Real wage growth was 5.2 percent, calculating with April CPI of 9.5 percent.

Analysts told MTI that wages continued to grow at a fair clip in April amid a tight labour market, and likely future hikes could feed into stubbornly high inflation.

Peter Virovacz of ING Bank said a new aspect of wage growth is that hikes in the private sector were above those in the public sector, especially in sectors where there are labour shortages and where high minimum wages are a factor.

Household consumption may be boosted by strong real wage rises, leading to persistent demand-side inflation, he said. In the short term, inflation risks connected with the labour market remain on the upside, so the central bank is likely to carry on raising interest rates, he added.

Daniel Molnar of Szazadveg Economic Research noted that average real wage rises were peppery in April, with minimum wage rises putting upward pressure on wages in higher pay brackets, though labour shortages were also a factor. Wage hikes are likely to continue, he said.

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