UK wages rise slightly. Inflation stabilizes.
This article is originally referred from Orbex Market Recap.
The UK’s Office for National Statistics released the monthly jobs report data and inflation figures for the month ending September.
According to the official report, the UK’s unemployment rate held steady at 4.3% as widely forecasted during the third quarter.
This was the same rate as compared to the previous three months ending August.
The unemployment rate at 4.2% was the lowest since the three months ending May 1975. The labor market data showed that the number of unemployment rose by 75% in the July through September period. This was slightly higher than the 74.4% increase seen a year ago.
The UK’s average weekly earnings data showed an increase of 2.2% which included both bonuses and excluding bonuses on a yearly basis. Economists forecasted a headline print of 2.1%. Although there was a slight improvement, wages continue to lag behind the faster pace of inflation increase.
Interest Rate & Interest Rate
Previously in the week, the ONS released the monthly inflation figures.
Consumer prices in the UK were seen rising at a steady pace of 3.0% for the month of October. This was the same pace of increase seen in the previous month and was below forecasts of a 3.1% increase.
Core consumer prices rose 2.7% which was also the same pace of increase seen in the month of October. Economists were forecasting that core consumer prices might have increased 2.8%.
The Bank of England raised interest rates in November by 25 basis points to 0.50%. The rate hike came amid a difficult decision as wages remained weak while consumer prices continued to rise rapidly. The central bank’s decision was seen as dovish rate hike as no further increases were seen in the near term.
The Bank of England also expects that consumer prices might decline in the coming months. However, ongoing uncertainty regarding the Brexit negotiations continue to weigh on the exchange rate as well as impacting investments in the nation.
Original Source: Orbex Market Recap