UK Wage Growth Eases, Falling in Line with Bank of England's Predictions

Image Credit: Reuters

British wage growth, excluding bonuses, declined to its slowest pace in over two years in the third quarter, offering signs that inflation pressures may be easing, as hoped by the Bank of England (BoE).

Data from the Office for National Statistics (ONS) revealed that average weekly earnings, excluding bonuses, rose by 4.8% year-on-year in the three months ending in September. This marks the weakest growth since June 2022 and aligns with the BoE’s forecast.

While economists surveyed by Reuters had anticipated a 4.7% wage growth, the actual data came in slightly higher but remained within the BoE’s expectations.

The BoE, which cut interest rates last Thursday for only the second time since 2020, indicated that any future rate reductions are likely to proceed gradually due to the anticipated inflationary impact of the upcoming government budget.

Additionally, private sector wage growth also matched the 4.8% rise, aligning with the BoE's projections, and underscoring a loosening labor market as job vacancies dropped to their lowest level since May 2021.

Paraphrasing text from "Reuters"all rights reserved by the original author.