Heikensten says slower wage growth needed

SWEDEN - Sweden's membership of European economic and monetary union will demand a higher government budget surplus and lower wage increases, Lars Heikensten, deputy governor of Sweden's central bank told Dagens Nyheter Sunday.

The government's current budget surplus target of 2% of gross domestic product needs to be raised to 3% of GDP, Heikensten said.

"The fiscal policy has to check the demand in the economy to such an extent that the wages are not allowed to accelerate," he told the paper.

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