• Saturday, April 13, 2024

Business

UK unemployment edges higher as wage growth eases

A file photo of a Job Centre Plus office in Shrewsbury, Shropshire. (iStock)

Shajil KumarBy: Shajil Kumar

Unemployment in recession-hit Britain has nudged higher as growth in wages falls further, according to official data Tuesday that supports analyst expectations of an upcoming cut to UK interest rates.

The unemployment rate rose to 3.9 per cent in the three months to the end of January, up from 3.8 per cent in the final quarter of last year, the Office for National Statistics said in a statement.

Average regular pay growth, excluding bonuses, fell to 6.1 per cent from 6.2 per cent, the ONS added.

Taking into account Britain’s annual inflation rate during the reporting period, real wages rose by only two per cent.

Like the Federal Reserve and European Central Bank, the Bank of England is seen possibly cutting interest rates as soon as June as inflation cools and following multiple hikes to combat soaring prices.

“The easing in wage growth… is probably still a bit too slow for the Bank of England’s liking,” said Paul Dales, chief UK economist at Capital Economics research group.

“But there are encouraging signs that a more marked slowdown is just around the corner and that an interest rate cut in June is possible.” (AFP)

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