In the formal sector, company finance data suggest that the wage  BIS central bankers’ speeches  5  bill has risen at a faster rate since the middle of 2009–10. As wages increase, entitlement goes up, and consequently demand and preference for essential commodities increases.
Third, with the persistence of near double-digit inflation in 2010 and 2011, the medium- to long-term inflation expectations in the economy have risen, underscoring the role of higher food prices in expectations formation. If inflation is expected to be persistently high, workers bargain for higher nominal wages to protect their real income.