UK August ILO unemployment rate 4.7% vs 5.0% expected
Prior 4.9%
UK August employment change 102k vs 5k expected
Prior 67k
UK August average weekly earnings +3.7% vs +3.8% 3m/y expected
Prior +3.9%
UK August average weekly earnings (ex bonus) +3.7% vs +3.6% 3m/y expected
Prior +3.5%; revised to +3.6%
UK September payrolls change 13k
Prior -26k; revised to 1k
Wow. That is quite the contrast from what we saw with the July numbers on employment and unemployment, as well as the drastic revision higher to the payrolls figure for August.
That being said, I just want to firstly warn about the fact that the ONS is still facing data quality issues with their labour force survey (LFS) and it is tough to quantify how much of this may be attributed to that. The UK stats office continues to attach their usual caveat to the labour market report:”Unemployment rate and inactivity rate: there are quality issues with the estimates for employment, unemployment and economic inactivity from the Labour Force Survey.”
So, just keep that in mind.
But at first glance, these numbers show some improvement in labour market conditions after the recent softness. That would be a welcome development for the more hawkish members on the BOE, affording some added room for policymakers to consider another rate hike to battle the inflation monster.
Besides that, wage pressures are also holding up for the most part with real earnings continuing to stay more stubborn. Real regular earnings growth adjusted for CPI is at 0.8%, marking a growth of 0.4% compared to the past quarter.
All in all, the data here will keep alive the prospect of another rate hike by the BOE heading into November. But with traders already pricing in roughly 95% of a move, there isn’t too much else to go on. So, the data here will very much reinforce those expectations more than anything else.
This article was written by Justin Low at investinglive.com.
