The explanation for this year’s decline lies in the fact that automatic wage indexation, whereby wages are adjusted for inflation, is delayed for many employees. Inflation has been very high in Belgium for months, but many employees – more than one in three according to the National Bank – only see their wages adjusted once a year. The energy price shock may impact household purchasing power, at least temporarily, but people are better protected here than in other countries, according to the National Bank.
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Due to high inflation, many families are faced with great uncertainties. “This is also reflected in consumption, temporarily held back by the slow decline in purchasing power, but supported by the drop in the savings rate and by the indexation mechanism of wages and social benefits”, quotes ‘La Libre’ from the National Bank report. .
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