Wage Increases Feed Inflation

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It is difficult to bring inflation down despite clear signs of a cooling in the economy. Inflation is now primarily driven by domestic factors, making wage increases in excess of collective agreements difficult for the Central Bank. Central Bank Governor Ásgeir Jónsson and Deputy Governor Þórarinn G. Pétursson answered questions at an open meeting of the Althingi Economic and Trade Committee this morning. The topic of discussion was the bank's d…