The shortage of labour has intensified the pressure for higher wage increases, and the gap between growth in Danish and foreign wages has widened in recent years. Annual consumer price inflation reached 3.1 per cent in March, primarily driven by higher energy and food prices, as was also the case elsewhere. Consumers' expectations of price increases continue to rise.
The shortage of labour curbs economic growth in Denmark. In Danmarks Nationalbank's most recent forecast – from March – the central estimate is that the Danish economy will shift to markedly lower growth in the coming years. However, unemployment will not reach a level that is compatible with sustainable long-term development in wages until 2010.