And we expect this to continue in the years to come. In a fixed-exchange-rate regime as the Danish one, wages function as a buffer capturing shocks to the economy instead of the exchange rate. A flexible labour market and flexible wage formation are therefore essential.
There is still room for higher wage growth and employment in the Danish economy – but it should happen in an orderly way avoiding excesses. Another part of the economy which warrants vigilance is the housing market. Prices on single-family houses have been rising the past four years in large parts of the country. That is a good thing.