United Kingdom economy wins wages boost, unemployment dips

Getting warmer Two sunseekers enjoy the weather in Hyde Park London over the weekend

Getting warmer Two sunseekers enjoy the weather in Hyde Park London over the weekend

Unemployment in the United Kingdom fell 16,000 to 1.42 million, hitting 4.2 percent last December through this February, the lowest rate in 40 years, the government announced Tuesday.

Russ Mould, investment director at AJ Bell, said: "An acceleration in wage growth for British workers may put the Bank of England on a state of alert when it comes to the next interest rate increase but the nation's retailers may be pleased to see it after a very hard start to the year".

Unemployment fell from 4.3 per cent in January to only 4.2 per cent in the three months to February, according to data published today by the Office for National Statistics, the lowest level since 1975.

Inflation had topped 3% in recent months but more recently has eased, dipping to 2.7% in February.

Wages are watched closely by economists because consumer spending, one of the key drivers of GDP, is dependent on household...

Unemployment in the United Kingdom fell unexpectedly between December and February, according to new data released by the Office for National Statistics on Tuesday.

There were 1.42 million unemployed people in the United Kingdom over the period, according to the ONS, 16,000 fewer than September to November 2017.

The bank has stressed it is looking for wage growth before rate hikes.

"Employment rose again in the three months to February, to reach its highest ever rate since records began".

But while a May BOE rate increase is all-but priced in by investors, not everyone is convinced that the labor market is running out of slack.

A study co-authored by former policy maker David Blanchflower argued this week that there are still a significant number of people seeking more hours, meaning unemployment may have to fall below 3 per cent before wage growth picks up any serious traction.

The latest wage growth figure of 2.8% means that over the three-month period, pay increased at a faster pace than the ONS's preferred CPIH measure of inflation, which includes housing costs. The inactivity rate also declined to a record low.

At the end of 2017 there were 11,000 units of build-to-rent properties under construction, nine percent more than the end of 2016 and 140 per cent more that the average year-end level in the eight years through 2009 to 2016, according to data compiled by Molior London. It traded at US$1.4329 as of 10 am in London.

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