DAVOS, Switzerland, Jan 18 (Reuters) - Evidence from Portugal suggests some companies in the euro zone have been able to increase profit margins at a rate that risks hampering efforts to bring inflation down, Portuguese central bank governor Mario Centeno said on Wednesday.
"The numbers for Portugal are very clear: profit margins increased quite a bit in 2022," Centeno, who sits on the European Central Bank's rate-setting council, told Reuters on the sidelines of the World Economic Forum in Davos.
"That is not sustainable, not only because that will have an impact on prices, but also on demand.
However, Centeno said it was clear that company margin increases had as much potential as wage gains to force monetary policy to react if they were fueling inflationary pressures.
"1% point of extra margins or 1% of wages will prevent inflation from coming down.