Chancellor Rishi Sunak's Winter Plan for the economy hasn't done enough to prevent a wave of Job losses over coming months say Economists, and is being branded a tax on employers by one economist who has crunched the numbers.
The UK reported better than expected headline employment figures on Tuesday, however economists remain overwhelmingly of the opinion that the labour market will deteriorate significantly into year-end.
The British Pound trades above the key 1.11 area against the Euro and 1.30 against the U.S. Dollar in the wake of the release of UK employment statistics that showed the country's unemployment rate reached 3.9% in June, which is better than the 4.2% markets were expecting.
The UK added 6K jobs in the three months to April according to the ONS, which was a surprising result for a market that was anticipating a fall in employment to the tune of 83K.
Sterling volatility was seen on Tuesday after Heiko Maas indicated a harder line will be forthcoming from Germany on any future Brexit extensions, while the domestic agenda will be dominated by UK wage and employment data.
The UK labour market appears to be in decent shape with numbers out of the ONS confirming January saw a joint record for the numbers of employed in the UK economy.
Unemployment fell back to a multidecade low and wages rose at their fastest pace since the financial crisis during November, according to Office for National Statistics data released Tuesday, as the labour market tightened further toward year-end.
The labour market remained in rude health during October, keeping the unemployment rate close to a multi-decade low and helping to lift the rate of wage growth to its highest level since April 2010.
U.K. wages grew faster-than-expected in August according to the latest labour market statistics released by the Office for National Statistics, news that allowed Sterling to recover more of the losses suffered at this week's open.
The Bank of England's Chief Economist and prominent Monetary Policy Member Andy Haldane has told a gathering in London that the U.K. is seeing a "new dawn breaking for pay growth."
The Pound advanced further on rivals Tuesday after official data showed wage pressures building in the UK's tight labour market while traders also continued to reward signs of progress in the Brexit negotiations with a steady bid for Sterling.
A busy week of UK data releases kicks off today with employment and wage data due for release at 09:30 B.S.T.
Official data shows the UK economy continues to create jobs at a robust pace with May seeing a record proportion of the population participating in the labour market.
Pound Sterling erased earlier losses and advanced against the developed world currency basket Tuesday after the latest labour market report showed the UK economy continuing to create new jobs at a rapid clip in April, keeping the unemployment rate at a multi-decade low.
The British Pound firmed as a highly-anticipated set of labour and wage data broadly met expectatations.
The Pound pared earlier gains Tuesday as traders responded to a mixed labour market report, which showed wage packets growing slower than was expected in February, while the unemployment rate fell to a new 42 year low.
But businesses still proving reluctant to push pay rates higher, something the Bank of England is looking for to justify raising interest rates in 2018.
The Pound rose strongly against a basket of developed world currencies Wednesday as markets responded to the latest volley of labour market data, which showed UK wages growing faster than expected during January.
The outlook for Pound Sterling brightened Monday when an IHS Markit survey showed a rise in UK wage pressures during the current month, which is something that is sure to grab the attention of Bank of England rate setters later this week.
Unemployment may be at historic lows but that doesn't seem to be increasing pay, as traditional economic theory would suggest.
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