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UK jobs report shows little sign of immediate Brexit hit - business live UK jobs report shows little sign of immediate Brexit hit - business live
(35 minutes later)
5.03pm BST
17:03
The pound has slipped back to below its pre-jobs data level against the dollar.
It is currently down 0.26% at $1.3012, having earlier climbed as high as $1.3070. Against the euro, sterling is down 0.15% at €1.1548.
4.36pm BST4.36pm BST
16:3616:36
Markets are taking a bit of a dip ahead of the US Federal Reserve meeting, despite oil prices holding up after the US data.Markets are taking a bit of a dip ahead of the US Federal Reserve meeting, despite oil prices holding up after the US data.
But investors also have the UK jobs data and the uncertainty of the Brexit negotiations on their minds. Joshua Mahony, market analyst at IG, said:But investors also have the UK jobs data and the uncertainty of the Brexit negotiations on their minds. Joshua Mahony, market analyst at IG, said:
There is a certain degree of trepidation in the markets today, with indices selling off sharply in anticipation of the minutes of the Federal Open Market Committee’s last meeting, due out this evening. The July FOMC meeting took place after market fears had subsided in the wake of the UK’s referendum on EU membership, with the statement citing diminished near-term risks. If the committee no longer believes external factors are worth worrying about, then a 2016 rate hike is a distinct possibility. Given that much of the post-referendum surge in stocks has come from dovish monetary policy implications, hawkish comments are likely to exacerbate the weakness we are already seeing for markets today.There is a certain degree of trepidation in the markets today, with indices selling off sharply in anticipation of the minutes of the Federal Open Market Committee’s last meeting, due out this evening. The July FOMC meeting took place after market fears had subsided in the wake of the UK’s referendum on EU membership, with the statement citing diminished near-term risks. If the committee no longer believes external factors are worth worrying about, then a 2016 rate hike is a distinct possibility. Given that much of the post-referendum surge in stocks has come from dovish monetary policy implications, hawkish comments are likely to exacerbate the weakness we are already seeing for markets today.
Today’s UK jobs report is significant in the post-referendum world, with Brexiteer jeers ringing out as they use the figures to back their argument that the pro-remain camp was fear-mongering with its warnings over the impact on the economy. It is certainly too early to say how the UK economy will react to the referendum result and eventual Brexit from the EU, but today’s surprise decrease in July claimants suggests that businesses are waiting it out rather than making any rash judgements of the implications.Today’s UK jobs report is significant in the post-referendum world, with Brexiteer jeers ringing out as they use the figures to back their argument that the pro-remain camp was fear-mongering with its warnings over the impact on the economy. It is certainly too early to say how the UK economy will react to the referendum result and eventual Brexit from the EU, but today’s surprise decrease in July claimants suggests that businesses are waiting it out rather than making any rash judgements of the implications.
Comments from Germany’s European Affairs Minister hinting that the UK may be able to obtain a “special status” post-Brexit are an encouraging signal ahead of the exit negotiations. Once article 50 is enacted, any perceived developments within trade discussions are sure to be significant volatility drivers in the markets, raising the prospect of two years of unpredictability.Comments from Germany’s European Affairs Minister hinting that the UK may be able to obtain a “special status” post-Brexit are an encouraging signal ahead of the exit negotiations. Once article 50 is enacted, any perceived developments within trade discussions are sure to be significant volatility drivers in the markets, raising the prospect of two years of unpredictability.
The number one concern within the city is whether the UK will retain passporting rights, and success on this issue could define whether negotiations are perceived as a success or failure within financial markets.The number one concern within the city is whether the UK will retain passporting rights, and success on this issue could define whether negotiations are perceived as a success or failure within financial markets.
3.46pm BST3.46pm BST
15:4615:46
US crude stocks in surprise weekly dropUS crude stocks in surprise weekly drop
And now oil is recovering some ground after the US inventory figures showed an unexpected fall last week.And now oil is recovering some ground after the US inventory figures showed an unexpected fall last week.
The Energy Information Administration said crude stocks dropped by 2.5m barrels compared to forecasts of a 522,000 increase. Gasoline stocks fell by 2.7m barrels, much higher than the expected 1.6m barrel drop.The Energy Information Administration said crude stocks dropped by 2.5m barrels compared to forecasts of a 522,000 increase. Gasoline stocks fell by 2.7m barrels, much higher than the expected 1.6m barrel drop.
#UnitedStates EIA Crude Oil Stocks Change at -2.5M https://t.co/iEqHb9iXvN pic.twitter.com/yro6aUL5rK#UnitedStates EIA Crude Oil Stocks Change at -2.5M https://t.co/iEqHb9iXvN pic.twitter.com/yro6aUL5rK
EIA reports US #crude oil inventories fell 2.5m barrels last week, more than expected and higher than API estimate (1m). #WTI oil jumps ^FREIA reports US #crude oil inventories fell 2.5m barrels last week, more than expected and higher than API estimate (1m). #WTI oil jumps ^FR
Following the figures Brent crude is now in positive territory, up 0.1% at $49.28 a barrel while West Texas Intermediate - the US benchmark - is down 0.19% at $46.39, having earlier been as low as $45.84.Following the figures Brent crude is now in positive territory, up 0.1% at $49.28 a barrel while West Texas Intermediate - the US benchmark - is down 0.19% at $46.39, having earlier been as low as $45.84.
3.10pm BST3.10pm BST
15:1015:10
Ahead of the latest weekly US oil stocks report, Reuters is reporting that Saudi Arabia could boost its output in August to a new record of 10.8m to 10.9m barrels a day.Ahead of the latest weekly US oil stocks report, Reuters is reporting that Saudi Arabia could boost its output in August to a new record of 10.8m to 10.9m barrels a day.
The news has pushed oil prices slightly lower, with Brent crude now down 0.35% at $49.06 a barrel.The news has pushed oil prices slightly lower, with Brent crude now down 0.35% at $49.06 a barrel.
2.43pm BST2.43pm BST
14:4314:43
Wall Street opens lowerWall Street opens lower
As expected US markets have followed the example of Europe and slipped back in early trading.As expected US markets have followed the example of Europe and slipped back in early trading.
But investors remain cautious ahead of the US Federal Reserve minutes due later. The Dow Jones Industrial Average is down 41 points or 0.22% while the S&P 500 and Nasdaq opened virtually flat.But investors remain cautious ahead of the US Federal Reserve minutes due later. The Dow Jones Industrial Average is down 41 points or 0.22% while the S&P 500 and Nasdaq opened virtually flat.
1.54pm BST1.54pm BST
13:5413:54
US markets are expected to open roughly flat as investors await the FOMC minutes from the July meeting later in the day.US markets are expected to open roughly flat as investors await the FOMC minutes from the July meeting later in the day.
US Opening Calls:#DOW 18537 -0.10%#SPX 2179 +0.06%#NASDAQ 4804 +0.14%#IGOpeningCallUS Opening Calls:#DOW 18537 -0.10%#SPX 2179 +0.06%#NASDAQ 4804 +0.14%#IGOpeningCall
1.40pm BST1.40pm BST
13:4013:40
UK working age households are still £400 a year worse off than before the 2008 financial crisis according to Resolution Foundation.UK working age households are still £400 a year worse off than before the 2008 financial crisis according to Resolution Foundation.
The thinktank warns that a near “lost decade” in household incomes is in danger of being extended by a triple whammy of slower economic growth, higher inflation, and benefit cuts.The thinktank warns that a near “lost decade” in household incomes is in danger of being extended by a triple whammy of slower economic growth, higher inflation, and benefit cuts.
Resolution’s analysis of ONS figures found that working age households have been the ones to suffer.Resolution’s analysis of ONS figures found that working age households have been the ones to suffer.
Adam Corlett, economic analyst at Resolution Foundation:Adam Corlett, economic analyst at Resolution Foundation:
Despite welcome income growth in 2015-16, the typical non-retired household remains some £400 a year worse-off than before the financial crisis of 2008.Despite welcome income growth in 2015-16, the typical non-retired household remains some £400 a year worse-off than before the financial crisis of 2008.
We’re closing in on a lost decade for working-age households, which leaves the typical family around £8,500 a year poorer than would have been the case had we maintained pre-crisis levels of income growth.We’re closing in on a lost decade for working-age households, which leaves the typical family around £8,500 a year poorer than would have been the case had we maintained pre-crisis levels of income growth.
The concern now is that lower income working-age households risk experiencing a ‘triple whammy’ of income recovery shocks as growth slows in the aftermath of the EU referendum vote, inflation picks up and cuts such as the four-year freeze on working-age benefits start to bite. This risks not only delaying the recovery for these families, but flipping it into reverse.The concern now is that lower income working-age households risk experiencing a ‘triple whammy’ of income recovery shocks as growth slows in the aftermath of the EU referendum vote, inflation picks up and cuts such as the four-year freeze on working-age benefits start to bite. This risks not only delaying the recovery for these families, but flipping it into reverse.
1.27pm BST1.27pm BST
13:2713:27
Gold prices have slipped following those hawkish comments from Fed policymakers William Dudley and Dennis Lockhart.Gold prices have slipped following those hawkish comments from Fed policymakers William Dudley and Dennis Lockhart.
Both said a September interest rate rise was possible, sending spot gold down 0.2% at $1,343 an ounce, while US gold was down 0.6% at $1,348.60 an ounce. Rate rises tend to mean a stronger dollar, and a stronger dollar tends to signal weaker gold prices.Both said a September interest rate rise was possible, sending spot gold down 0.2% at $1,343 an ounce, while US gold was down 0.6% at $1,348.60 an ounce. Rate rises tend to mean a stronger dollar, and a stronger dollar tends to signal weaker gold prices.
1.06pm BST1.06pm BST
13:0613:06
Uber, the taxi company that operates through an app, is legally challenging Transport for London’s plans to force drivers to take a written English test.Uber, the taxi company that operates through an app, is legally challenging Transport for London’s plans to force drivers to take a written English test.
Our full story here:Our full story here:
Related: Uber takes TfL to high court over English written testRelated: Uber takes TfL to high court over English written test
12.11pm BST12.11pm BST
12:1112:11
Andrew Tyrie, Conservative MP and chairman of the Treasury select committee, is seeking a review of the government’s sale of some of its stake in bailed out bank RBS.Andrew Tyrie, Conservative MP and chairman of the Treasury select committee, is seeking a review of the government’s sale of some of its stake in bailed out bank RBS.
Specifically, Tyrie wants the National Audit Office to look without delay into the advice given by UK Financial Investments - the body set up to manage the taxpayer’s stakes in bailed out banks - to the government before the first sale of shares in 2015.Specifically, Tyrie wants the National Audit Office to look without delay into the advice given by UK Financial Investments - the body set up to manage the taxpayer’s stakes in bailed out banks - to the government before the first sale of shares in 2015.
Tyrie says:Tyrie says:
Parliament and the public will want reassurance that the Chancellor’s decision to sell the first tranche of shares in RBS in August 2015 secured the best value for money for the taxpayer, and was not influenced by political expediency.Parliament and the public will want reassurance that the Chancellor’s decision to sell the first tranche of shares in RBS in August 2015 secured the best value for money for the taxpayer, and was not influenced by political expediency.
UKFI was created with the intention to ensure that state and partly state-owned banks are run, and seen to be run, free from government interference. There is a risk that UKFI is being used as a fig leaf to disguise a high level of Treasury control. UKFI’s advice on this sale is therefore of considerable public interest.UKFI was created with the intention to ensure that state and partly state-owned banks are run, and seen to be run, free from government interference. There is a risk that UKFI is being used as a fig leaf to disguise a high level of Treasury control. UKFI’s advice on this sale is therefore of considerable public interest.
A full and thorough review of the sale should not be left any longer.A full and thorough review of the sale should not be left any longer.
11.42am BST11.42am BST
11:4211:42
Outlook brightens for UK household financesOutlook brightens for UK household finances
Households were less pessimistic about the outlook for their finances in August according to the latest survey from Markit.Households were less pessimistic about the outlook for their finances in August according to the latest survey from Markit.
It followed a slump in July as consumers were concerned about the impact the Brexit vote would have on disposable incomes.It followed a slump in July as consumers were concerned about the impact the Brexit vote would have on disposable incomes.
Expectations for finances over the next 12 months picked up to 49.8 on Markit’s household finances index in August, from 47.1 in July. Anything below 50 signals deterioration, so households are still feeling cautious.Expectations for finances over the next 12 months picked up to 49.8 on Markit’s household finances index in August, from 47.1 in July. Anything below 50 signals deterioration, so households are still feeling cautious.
The highest earners and private sector workers were the most confident about the outlook for their finances.The highest earners and private sector workers were the most confident about the outlook for their finances.
Jack Kennedy, senior economist at Markit:Jack Kennedy, senior economist at Markit:
The outlook for household finances stabilised in August after last month’s wobble following the Brexit vote. Expectations regarding future finances improved to the highest for five months, while current finances remain under pressure but no more so than the trend seen over the past year-and-a-half.The outlook for household finances stabilised in August after last month’s wobble following the Brexit vote. Expectations regarding future finances improved to the highest for five months, while current finances remain under pressure but no more so than the trend seen over the past year-and-a-half.
Concerns seem to have eased in line with the removal of some of the immediate political uncertainty arising from the shock referendum result, combined with a strong monetary policy response from the Bank of England aimed to cushion the economy and head off any lurch towards recession.Concerns seem to have eased in line with the removal of some of the immediate political uncertainty arising from the shock referendum result, combined with a strong monetary policy response from the Bank of England aimed to cushion the economy and head off any lurch towards recession.
11.11am BST11.11am BST
11:1111:11
Jasper Lawler from CMC Markets has this take in this morning’s drop in European markets:Jasper Lawler from CMC Markets has this take in this morning’s drop in European markets:
European markets dipped on Tuesday as profit-taking continued for a second day. Shares of Carlsberg led the declines after a rise in profits at the Dutch brewer fell short of estimates.European markets dipped on Tuesday as profit-taking continued for a second day. Shares of Carlsberg led the declines after a rise in profits at the Dutch brewer fell short of estimates.
The German DAX has fallen to its lowest in over a week after turning positive for the first time this year on Monday.The German DAX has fallen to its lowest in over a week after turning positive for the first time this year on Monday.
Trading was thin on the FTSE 100 with minimal share price movement as traders took stock of a fall in employment claims and another sign that the economy has held its own post-Brexit.Trading was thin on the FTSE 100 with minimal share price movement as traders took stock of a fall in employment claims and another sign that the economy has held its own post-Brexit.
Lawler says Wall Street’s opening is likely to be mixed as traders await the minutes of the Federal Reserve’s July meeting in which rates were held. The minutes are due at 7pm UK time.Lawler says Wall Street’s opening is likely to be mixed as traders await the minutes of the Federal Reserve’s July meeting in which rates were held. The minutes are due at 7pm UK time.
10.59am BST10.59am BST
10:5910:59
Chris Hare, economist at Investec, brings us back down to earth with this rather gloomy take on the UK jobs market and outlook for households:Chris Hare, economist at Investec, brings us back down to earth with this rather gloomy take on the UK jobs market and outlook for households:
In coming months, we anticipate a hiring slowdown to lead to a sharp slowing in, or even a contraction in, net job creation. We anticipate that to be reflected in gradual rises in the unemployment rate.In coming months, we anticipate a hiring slowdown to lead to a sharp slowing in, or even a contraction in, net job creation. We anticipate that to be reflected in gradual rises in the unemployment rate.
Meanwhile, post-referendum falls in sterling (down over 10% since 23 June) is set to squeeze household real take-home pay.Meanwhile, post-referendum falls in sterling (down over 10% since 23 June) is set to squeeze household real take-home pay.
Over time, this double-whammy of lower jobs growth and higher inflation is set to weigh on household income and spending growth. If we are right (and we hope to be surprised to the upside) then this new dynamic might make today’s labour market data look like a relic of a bygone era.Over time, this double-whammy of lower jobs growth and higher inflation is set to weigh on household income and spending growth. If we are right (and we hope to be surprised to the upside) then this new dynamic might make today’s labour market data look like a relic of a bygone era.
10.48am BST10.48am BST
10:4810:48
Here is our full story on Admiral, which is dragging the FTSE 100 lower with an 8.5% drop in the share price.Here is our full story on Admiral, which is dragging the FTSE 100 lower with an 8.5% drop in the share price.
Related: Admiral blames low interest rates for drop in solvency ratioRelated: Admiral blames low interest rates for drop in solvency ratio
10.41am BST10.41am BST
10:4110:41
The upbeat jobs report has failed to lift the pound, which remains pretty much where it was before the figures were published at $1.3019.The upbeat jobs report has failed to lift the pound, which remains pretty much where it was before the figures were published at $1.3019.
The FTSE 100 is also underwhelmed, and European markets are now in the red after opening slightly higher.The FTSE 100 is also underwhelmed, and European markets are now in the red after opening slightly higher.
10.28am BST10.28am BST
10:2810:28
As John Philpott, expert on the labour market and director of The Jobs Economist, points out, the better-than-expected figures could be the calm before the storm...As John Philpott, expert on the labour market and director of The Jobs Economist, points out, the better-than-expected figures could be the calm before the storm...
Frustratingly, most of these figures end just at the point at which the UK decided to make its historic change of political and economic direction.Frustratingly, most of these figures end just at the point at which the UK decided to make its historic change of political and economic direction.
It’s thus too early to tell whether the jobs market will easily shrug-off the shock of Brexit or instead that these latest figures merely mark the calm before the storm that many economists fear could add up to 500,000 to the jobless count.It’s thus too early to tell whether the jobs market will easily shrug-off the shock of Brexit or instead that these latest figures merely mark the calm before the storm that many economists fear could add up to 500,000 to the jobless count.
10.20am BST10.20am BST
10:2010:20
In the run up to the referendum the jobs market was strengthening, and in better shape than expected.In the run up to the referendum the jobs market was strengthening, and in better shape than expected.
“What pre-Brexit jitters?”, asks Alan Clarke, economist at Scotiabank:“What pre-Brexit jitters?”, asks Alan Clarke, economist at Scotiabank:
The UK labour report was much stronger than we expected and surprisingly robust in the face of pre-referendum uncertainty.The UK labour report was much stronger than we expected and surprisingly robust in the face of pre-referendum uncertainty.
Firms stepped up hiring before the referendum it seems - in stark contrast to the pre-General Election experience.Firms stepped up hiring before the referendum it seems - in stark contrast to the pre-General Election experience.
The acid test will be the next few months to see if hiring stalled in the aftermath of the vote. I suspect that will take longer to show up, but then again, I was expecting pre-Brexit jitters to show up today, so what do I know?The acid test will be the next few months to see if hiring stalled in the aftermath of the vote. I suspect that will take longer to show up, but then again, I was expecting pre-Brexit jitters to show up today, so what do I know?
10.16am BST10.16am BST
10:1610:16
Key points from the ONS jobs reportKey points from the ONS jobs report
In the three months ending June:In the three months ending June: