Yahoo Finance U.K. unemployment rate slips to fresh 42-year low, real wages ease
Investing.com - The jobless rate in the U.K. unexpectedly decreased in May while real wages continued to ease, increasing the pressure on British families to make it to the end of the month given the gap with inflation, official data showed on Wednesday.
The Office for National Statistics said that the rate of unemployment fell to 4.5% in May, surprising analysts who had expected it to remain unchanged at a four-decade low of 4.6%.
The claimant count increased by a seasonally adjusted 6,000 in June, compared to expectations for a gain of 10,000 people and following a rise of 7,500 a month earlier, whose figure was revised from a previously reported increase of 7,300.
Meanwhile, the average earnings index, including bonuses, rose by a seasonally adjusted 1.8% in the three months to May, in line with forecasts but below the previous month’s gain of 2.1%. The squeeze on real wages continues in the U.K. with inflation having clocked in at 2.9% in May, meaning that Britons are having a harder time making ends meet.
Excluding bonuses, wages rose by 2.0% in the three months to May, compared to expectations for a 1.9% gain and April’s reading of 1.8% that was increased from an initial 1.7% advance.
Following the report, the pound strengthened. GBP/USD traded at 1.2848 from around 1.2835 ahead of the release of the data, EUR/GBP was at 0.8915 from 0.8925 earlier, while GBP/JPY exchanged hands at 145.76 compared to 145.54 previously.
Meanwhile, European stock markets traded higher. London’s FTSE 100 rose 0.66%, the benchmark Euro Stoxx 50 traded up 0.53%, France's CAC 40 advanced 0.71%, while Germany's DAX gained 0.44%.
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