So there is a tension there. Our expectation is that wages growth will pick up from here, but the pick-up is likely to be only gradual. Firms are currently reporting a record number of job vacancies and increasingly telling us that it is hard to find workers with the right skills.
Certainly monetary policy has been effective in reducing the macroeconomic impact from the initial shocks caused by the bursting of the bubble. Many central banks in advanced economies have brought down interest rates close to zero to support economic recovery this time. Unconventional measures, such as the large scale purchases of assets, have been introduced as well, in order to support malfunctioning financial markets.