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19 Mar 2015
UK labour market figures a bit disappointing - Capital Economics
FXStreet (Bali) - Vicky Redwood, Economist at Capital Economics, notes that the latest UK labour market figures were a bit disappointing.
Key Quotes
The latest labour market figures were a bit disappointing, with the ILO unemployment rate holding steady at 5.7% in January, rather than dropping as expected.
And wage growth slowed, with the annual growth rate of average weekly earnings falling from 2.4% to 1.1%. (Data released on Wednesday.)
As pointed out in the MPC minutes of March’s meeting, pay growth is still below the rates that are consistent with inflation returning to its target.
And Governor Mark Carney’s comments that the rise in the pound raises the risk of a prolonged period of very low inflation were echoed. Accordingly, an interest rate rise still looks to be some way off.
Key Quotes
The latest labour market figures were a bit disappointing, with the ILO unemployment rate holding steady at 5.7% in January, rather than dropping as expected.
And wage growth slowed, with the annual growth rate of average weekly earnings falling from 2.4% to 1.1%. (Data released on Wednesday.)
As pointed out in the MPC minutes of March’s meeting, pay growth is still below the rates that are consistent with inflation returning to its target.
And Governor Mark Carney’s comments that the rise in the pound raises the risk of a prolonged period of very low inflation were echoed. Accordingly, an interest rate rise still looks to be some way off.