Cliff Notes – Bank of England mulls interest rate decision
- Wage growth remains robust, with wages excluding bonuses rising by 5.9% in the three months to January 2024, maintaining the same rate as the previous month.
- Despite a slight dip in average weekly earnings including bonuses to 5.8%, this growth continues to exceed the 3% inflation rate for that 12 month term, impacting the Bank of England’s interest rate considerations.
- The unemployment rate holds steady at 4.4%, while economic inactivity has decreased, reflecting positive trends amid ongoing welfare reforms aimed at increasing workforce participation.
Bank of England mulls interest rate decision
Wage growth has remained strong, the latest official figures show, as the Bank of England mulls its interest rate decision.
Wages – excluding bonuses – grew 5.9% in the three months to January, the same amount as a month earlier, data from the Office for National Statistics (ONS) showed.
However, wages have been catching up since the drastic rise in inflation since the pandemic. So growth is only relative to this period, and if you consider the wage growth in the last 5 years, they are in negative growth.
Wage growth
Meanwhile, growth in average weekly earnings, including bonuses, fell to a surprise 5.8%. Economists polled by the Reuters news agency anticipated a 5.9% rise.
It means wage growth is still high and well above the rate of overall price rises. Inflation stood at 3% in January.
Both private and public sectors have seen rises, the ONS said, describing the growth as “strong”.
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