UK wage growth proves sticky despite rising unemployment - ING

ING economists said: "Wage growth is temporarily stuck in the 6% area and that's another reason to think the Bank of England will wait until August to cut rates for the first time, despite signs of a cooling jobs market. The latest UK jobs report is bit of a mixed bag, but a surprise surge in private sector pay will be what ultimately catches the eye of Bank of England policymakers. Regular pay, which strips out volatile one-off/bonus payments, rose by 12% on a month-on-month annualised basis.

Admittedly, one month doesn’t make a trend and in fact, if you average out the last three months of data and compare it to the same period a year ago, the rate of private sector pay growth was still down a fraction to 6.0%. Nevertheless, we know that the Bank has occasionally flagged this month-on-month change as something it does pay attention to. And at the very least, policymakers will have a keen eye on the next round of data to see if that sort of monthly growth is sustained."

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