Welcome to the Eurointelligence podcast. I'm Wolfgang Munchau and with me are Zuzana Muncheng and Jack Smith.

Today we would like to talk about inflation and wages and about Germany's coup, the coup that didn't take place that was foiled this week, but that has lots of interesting sub-aspects that we should discuss in some detail.

On inflation, we've had stories this week in Eurointelligence on wage rises in various

sectors, on labor shortages.

Zuzana, you've written about France this morning.

What is the situation there?

France has a lower inflation rate than others, but how does this sort of play

through the labour market? At the moment, it doesn't play through it at all. France and Germany

had always inflation rates really very close to each other, like 0.2 percentage points apart

from each other since the 1991. But since the beginning of this year, and that was even before the war in Ukraine, because of the different VAT systems and changes after the pandemic, the gap piece has measured from the CPI starts to increase.

And now, I think in November debt numbers were 10% for Germany and 6.4% for France.

Now, the French were even at 4%, they were already kind of

screaming about inflation. But in factual terms, in terms of wage negotiations, it didn't end up

to do much of a difference. So two studies from Cimetics, a private one, they looked at various

sectors and contacted human resources

because in France, other than in Germany, liegers are negotiated as a company level.

And they found that most of them didn't have any increase or any discussion about

inflation compensation at all this year. There were some

adjustments when it comes to transfer, but this is kind of a government subsidized scheme where you

can get some tax breaks. But moving forward, there definitely are pressures coming up. We see in

Stalantis, the carmaker, four trade unions now ask for inflation compensation for next year in the

range of 7.5 to 8.5%. So the wage

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