"The concern is generic, and it has to do precisely with this concern about price dynamics and what we have known for a long time about the impact of prices on the well-being of economic agents, in particular when prices rise in a very marked way".

The governor considered that "spirals in which prices are fuelled by wage increases, which in turn feedback on each other, are not desirable and should, of course, be avoided."

As for the risks of inflation being higher than estimated, Mário Centeno acknowledged that "it exists, which is why the balance of risks for the euro area, in terms of inflation that is identified, is an upward risk".

The BdP governor said that on a European scale, "the same risks exist" as those identified for Portugal, "which have to do with the risk of transmission of production costs to final prices".

"A central bank can never help but be concerned about second-round effects on wages," he said.

"We do not see this dynamic, at this moment, happening neither in the euro area nor in Portugal", he said, but reinforced that "the possible sources of possible pressures that could arise" should be signalled.

"Surely what is the evolution and dynamics instilled in the minimum wage can have this negative effect on the inflation indicator, and this is what we are signalling", stated the governor of the BdP, referring to the Economic Bulletin.

In the text, the BdP points out that "any increases in the minimum wage in 2023-24 are also an upside risk for inflation."