20 Jan 2016
UK: Unemployment rate to edge down to 5.1% - Lloyds Bank
FXStreet (Delhi) – Research Team at Lloyds Bank, notes that the UK labour market data for the 3 months to October reinforced the contrast between strong growth in employment with softer momentum in pay pressures.
Key Quotes
“While business surveys have for some time pointed to a mild slowing from an outsized pace of employment growth, they remain consistent with relatively robust employment intentions. Available leading indicators of pay pressures have meanwhile become somewhat more mixed.
The official data for the 3 months to November, the last before the MPC updates its projections for the February Inflation Report, should continue recent trends. We look for employment to rise by 205k relative to 3 months ago, with the unemployment rate edging down to 5.1%. But any impression of diminishing spare capacity is likely to be offset by softening pay growth, which we expect to slip to an annual pace of just 2.0%, likely the weakest since February 2015.”
Key Quotes
“While business surveys have for some time pointed to a mild slowing from an outsized pace of employment growth, they remain consistent with relatively robust employment intentions. Available leading indicators of pay pressures have meanwhile become somewhat more mixed.
The official data for the 3 months to November, the last before the MPC updates its projections for the February Inflation Report, should continue recent trends. We look for employment to rise by 205k relative to 3 months ago, with the unemployment rate edging down to 5.1%. But any impression of diminishing spare capacity is likely to be offset by softening pay growth, which we expect to slip to an annual pace of just 2.0%, likely the weakest since February 2015.”