	german wage round said to limit monetary options the bundesbank s options for west germany monetary policy are limited for the foreseeable future by the delicate stage of wage negotiations between unions and employers economists and money market dealers said call money fell in quite active trading today dropping to pct from pct yesterday and below the pct treasury bill rate as a difficult month end approached but dealers and economists said the bundesbank was unlikely to encourage lower rates in the foreseeable future largely for fear of upsetting the current wage round one money market dealer for a major foreign bank said i don t think the bundesbank wants rates to go up whatever happens but it also does not want them to fall above all it wants to wait to see how the unions wage round goes in west germany unions and employers prepare the ground for triennial wage negotiations based on detailed assessments of growth and inflation economists said ute geipel economist with citibank ag said if the bundesbank became more accommodating in monetary policy raising fears in some quarters of a return in inflation in the medium term unions would be obliged to curtail wage demands as a result the bundesbank was concerned to make no move that would interfere in the negotiating process geipel said in the current round the country s most powerful union the ig metall representing metalworkers and engineers is demanding a shortening of the working week to hours from the present and an accompanying five pct increase in wages the engineering employers association gesamtmetall is offering to bring in a hour week from july and give a two stage wage increase a pct rise from april this year and another pct from july the agreement forged by ig metall europe s largest union with mln members and the employers would set the benchmark for settlements in other industries such as the public sector banks and federal post office negotiations began in december and unions are hopeful they may conclude by early april ahead of the traditional holiday period in june though many economists said the unions current warning strikes and rhetoric were part of the negotiating strategy and would not lead to a repeat of s damaging seven week strikes others said unions would not compromise greatly on their positions and there could still be conflict this could extend the length of time in which the bundesbank would keep its activity low key economists said the money market head said the unions humiliation by the protracted financial problems of the neue heimat cooperative housing venture would contribute to union obstinacy the unions haven t forgotten that and they will put this squarely onto the account in the negotiations he said in addition the newly elected chairman of the ig metall union franz steinkuehler was more radical and determined than his predecessor hans meyer and may be set for a longer battle to achieve the best possible settlement for his membership more than engineering workers at firms mainly in south germany held warning strikes lasting up to two hours yesterday firms hit included zahnradfabrik passau gmbh and aerospace group messerschmitt boelkow blohm gmbh today employees from companies came out in warning strikes a statement from ig metall said money market dealers said that overnight call money rates would rise in the near future in any case and did not depend on a politically inhibited bundesbank about eight billion marks were coming into the market tomorrow from salary payments by the federal government as a result some banks fell back on the bundesbank s offer to mop up liquidity via the sale of three day treasury bills anticipating still lower rates before the month end but a pension payment date by banks on behalf of customers was due on monday other dealers noted if banks were short of liquidity until the bills matured on tuesday rates could soar perhaps to the pct lombard ceiling banks were well stocked up with funds having an average billion marks in bundesbank minimum reserves in the first days of march well above the billion requirement reuter 
