BoE's Saunders: Unemployment is set to rise further when furlough scheme ends
|Bank of England (BoE) policymaker Michael Saunders said on Thursday that the unemployment rate in the UK is set to rise when the furlough scheme ends, as reported by Reuters.
Additional takeaways
"Jobless rate in the UK has risen markedly."
"More people report falls in savings than rises, the aggregate rise is concentrated at the top end of the income scale."
"The UK labour market has plenty of spare capacity."
"5 million jobs are estimated to be furloughed."
"My key focus for monetary policy is ensuring that activity is firm enough to use up the slack, lower unemployment."
"Elevated unemployment would be a sign that the UK has too much spare capacity, would push inflation below target."
"I see factors that could cause a slow, incomplete recovery."
"Risks include household caution over spending, fears of unemployment."
"Even when the UK economy regains pre-crisis size, it may still have spare capacity."
"I will put a high weight on labour market data."
Market reaction
The British pound preserves its strength following these remarks and the GBP/USD pair was last seen gaining 0.65% on the day at 1.3944.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.