- Unemployment Rate for August: 4,8% (forecast: 4.7%; prior: 4.7%)
- Employment Change 3m/3m: 91k (forecast: 125k; prior 232k)
- Average wage with bonus: 5,0% YoY (forecast: 4.7%; prior: 4.7%)
The initial report highlighted the nominal 5.0% wage growth as a major inflationary risk for the BoE. However, by factoring in inflation, the picture shifts dramatically: while real total pay grew slightly (to +0.8%), the pace of real regular pay growth actually slowed (+0.6%).
This nuance is crucial for the Bank of England's Monetary Policy Committee. The MPC is primarily concerned with sustained domestic inflation pressures. If people's purchasing power (real regular wages) is only modestly increasing, or even falling slightly, the risk of a wage-price spiral—where higher wages push up costs, leading to demands for even higher wages—is significantly diminished. Given this context—softening employment alongside less pronounced real regular wage growth, it should bring BoE closer to another rate cut this year. GBPUSD weakens significantly after the report, approaching 1.33 level:
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