Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
Today we discover if Britain’s labour market has been damaged by months of Brexit uncertainty.
The latest unemployment report is expected to show that earnings growth including bonuses slowed in the last quarter, from 3.4% per year to 3.2%. That would erode some of the welcome pick-up in real wages growth, and leave households a little less protected from a no-deal Brexit crisis.
But…basic pay growth (excluding bonuses) may hold steady at 3.4% – matching last month’s strong reading.
Economists also predict that the UK unemployment rate remained at just 4%, its lowest level in over 40 years. If so, that would suggest firms are resisting laying off staff, despite the steady fall in business investment in recent quarters.
Britain’s labour market isn’t a Nirvana, of course, given concerns over zero-hours contracts, the long squeeze on public sector pay and the fact wages are still below their pre-crisis level in real terms.
But job creation has held up well, as Michael Hewson of CMC Markets explains:
One of the big surprises has been the resilience of the labour market in the last few years, and despite all the reports of job losses in retail and banking in recent months, employers across a number of other sectors have consistently reported difficulty in filling vacant positions.
Also coming up today
The City is as confused as everyone else about Brexit, after speaker John Bercow derailed the government’s plans to keep holding Meaningful Votes on Theresa May’s deal until MPs capitulated.
Sterling slid yesterday afternoon when Bercow dropped his bombshell, but this morning it’s flat at $1.3265 to the US dollar.
Adam Cole of Royal Bak of Canada says:
Firstly, it is now highly unlikely that MV3 will happen this week, though next week remains a strong possibility.
Secondly, as that would leave the Commons vote the other side of Thursday’s EU Council meeting, May will likely have to go to her “default” position of requesting a long delay to the UK’s exit date in Brussels on Thursday.
On the corporate front, online grocer Ocado, web fashion chain ASOS and clothing retailer Bonmarché are reporting results.
Plus, parliament’s Treasury Committee will be quizzing Robert Chote, head of the OBR budget watchdog, on last week’s Spring Statement (if MPs can tear themselves away from Brexit).
- 9.30am GMT: UK unemployment and earnings data for November-January
- 9.30am GMT: UK house price data for January
- 10am GMT: ZEW index of German economic confidence
- 10am GMT: Treasury Committee hearing with OBR chief Robert Chote