Today’s labour market report for the UK – released by the Office for National Statistics (ONS) – has the Bank of England (BoE) caught between a rock and a hard place. Wage pressures remain elevated and job figures appear to be starting to feel the impact of US President Donald Trump’s tariff plans, as well as the UK government’s economic policies.
According to the ONS report, the unemployment rate held steady at 4.4% in the three months to February, in line with market expectations. This is the fourth consecutive month that the rate has remained at this level, after recording a rise in October 2024.
Job vacancies in March fell to pre-pandemic levels for the first time in the last four years. Unemployment figures are closely monitored by the BoE’s policymakers as they reflect the state of the country’s economy.
Economists noted that UK businesses let go of 78,467 workers in March just ahead of the government’s latest budget measures taking effect this month. One of the measures closely associated with the jobs market is the increase of National Insurance Contributions (NIC) for employers, which is expected to push businesses’ salary costs higher.
ONS data also revealed average earnings including bonuses increased by 5.6%, matching January’s revised figure, but was slightly less than the 5.7% expected by market analysts. Average earnings growth excluding bonuses landed at 5.9%, 0.1% higher compared to January’s revised reading, but again below economists’ forecasts (6.0%). It should be noted that both figures outpaced the UK’s Consumer Price Index (CPI) inflation rate which stood at 2.8% in February.
Sterling strengthens against US Dollar
The British pound (GBP) strengthened against the US dollar (USD) and the euro (EUR), trading at US$1.31 and €1.16, respectively. Sterling is on track to print a sixth consecutive day in the green against the US dollar, recording its longest winning streak in the last nine months.
The GBP/USD is poised for further outperformance. Up 5.5% this year so far, price action on the monthly timeframe exhibits space to continue pressing north until highs of US$1.3434 – located just beneath resistance coming in at US$1.3483. Additional buying beyond said resistances shines the technical spotlight on another layer of resistance from US$1.4263. Meanwhile, on the daily timeframe, a breach of resistance around the US$1.3112 neighbourhood, serves as another bullish indicator towards at least US$1.3268.
UK March CPI report in focus
Some economists suggest that the BoE’s Monetary Policy Committee (MPC) could change its interest rate strategy, accelerating the rate cut pace this year to support the UK’s struggling economy, which may feel the additional pressure from Trump’s tariffs. Nevertheless, wage pressure and the danger of CPI inflation rising sharply could make the MPC’s members rethink their next steps.
Tomorrow, the ONS will publish the CPI inflation for March, with market analysts expecting a slight drop to 2.7% on a yearly basis, down from 2.8%.
Charts created using TradingView
Written by the FP Markets Research Team
This article was written by FL Contributors at www.forexlive.com. Read More Details
Finally We wish PressBee provided you with enough information of ( UK jobs data sends conflicting messages to Bank of England )
Also on site :
- Who Is FSU Shooting Suspect Phoenix Ikner? What We Know
- Man shot and killed by police in Golden Hill this week identified as Enrique Cortez, 37
- Israeli officials recently developed plans to attack Iranian nuclear sites in May