- Samuel Tombs, an economist at Capital Economics
In June, less people in the Europe's third largest economy claimed unemployment benefits; therefore, signalling that the British job market has not completely cooled off. The number of applicants for jobless benefits decreased by 4,900 in June, compared to a revised figure of an increase of 200 in May. Moreover, the June figure was surprisingly better than the increase of 1,000, expected by economists. The UK unemployment rate, however, remained unchanged at 5.6%, which is by 0.7% lower than in the same period a year before. Meanwhile, the amount of British looking for work rose 25,000 to 1.85 million.
In the meantime, wages in the UK rose steadily on an annual basis, albeit missing economists' forecasts. Pay with bonuses grew at 2.4% in June, compared to 3.2% jump in the preceding month. The slowdown in growth was mainly attributed to the 3.3% decline in bonuses in the reported period. Despite that, the basic pay growth came in line with the expectations of 2.8%, and slightly higher than the 2.7% jump the month before. In order for the Bank of England to move towards hiking its benchmark interest rates, great attention will be paid to the labour-market indicators.
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