UK employment comment
|The latest wage data has unexpectedly failed to show an increase in average earnings with the index coming in in-line with last month’s reading of 2.1%. Even if the reading had risen to the consensus forecast of 2.3% it would have done little to lift the mood of UK workers who are continuing to feel the squeeze of falling real wages. The fact that it comes in flat is a real disappointment and may increase the pressure on the BoE to take measures to curb inflation at their policy meeting tomorrow.
Yesterday saw the latest CPI data rise back to 2.9%, its joint-highest level since 2013, and with wage growth stalling there is now a pronounced cut occurring in real wages. Following the release sterling has pulled back against the US dollar after hitting its highest level in a year shortly after the European open this morning with the pair moving back below the 1.33 handle.
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