BOE’s Saunders: Weak sterling means inflation is likely to rise above 2%
|The Bank of England (BOE) MPC member Saunders is now crossing the wires, via Reuters, making a scheduled speech about the UK labor market, in London.
Key Headlines:
Labor mkt data will probably be one of key guides on which direction rates go
Little sign of significantly higher pay growth for 2017
Recent weakness in pay due to low productivity growth and low headline inflation
Subdued wage growth trend in part reflects structural changes
Avg weekly earnings growth remains modest, at 2-3% yoy
Shouldn’t set monpol to rule out sub-5% unemployment unless there’s evidence of higher wages or long-term inflation expectations
MPC’s target is for inflation not unemployment but jobs are important
Recent UK growth stronger than expected
Weak sterling means inflation is likely to rise above 2%
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