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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)
1.06pm BST
13:06
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.
Our full story here:
Related: 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
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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:
9.48am BST
09:48
The surprise fall in the number of people claiming unemployment benefits in July suggests the Brexit vote did not deal a major blow to employer confidence, in the immediate aftermath at least.
A total of 763,600 claimed jobless benefits last month, 8,600 fewer than in June.
It was the first monthly fall since February 2016.
Updated
at 9.59am BST
9.41am BST
09:41
Unemployment rate unchanged at 4.9%
The labour market report from the Office for National Statistics also showed the ILO unemployment rate was unchanged in the three months ending June, at 4.9% (as expected).
This measure relates to the period before the EU referendum on 23 June. Wage growth including bonuses ticked up to 2.4% over the period from 2.3% over the previous three months - bang in line with expectations.
Excluding bonuses, wages increased by 2.3%, up from 2.2%.
Related: UK unemployment claimant count falls after Brexit
Updated
at 9.42am BST
9.34am BST
09:34
UK jobless claims in surprise fall
A big surprise in the labour market data: the number of people claiming unemployment benefits fell by 8,600 in July, a month after the Brexit vote.
Economists were expecting a rise of 9,500.
No sign yet then that the Brexit vote is hurting the jobs market...
We will bring all the reaction.
Updated
at 9.35am BST
9.14am BST
09:14
Pound hovers above $1.30
The pound is managing to hold on above the $1.30 mark, although it is down 0.2%. It is currently trading at $1.3014.
Sterling rebounded on Tuesday following a surprise rise in the UK annual inflation rate to 0.6% in July from 0.5% in June, which in theory makes it less likely that the Bank of England will need to further cut rates.
Economists said however the Bank was likely to ignore a temporary rise in inflation and pump more money into the economy in a bid to limit the slowdown expected following the Brexit vote.
9.00am BST
09:00
Firms advising on tax avoidance could face large fines
The government has revealed plans to clamp down on accountants, lawyers and consultants who advise clients on how to aggressively avoid tax.
Advisers whose schemes are defeated in the courts might pay a fine of up to 100% of the money lost to the taxpayer.
Our full story here:
Related: Firms giving advice on aggressive tax avoidance could face large fines
8.51am BST
08:51
Admiral Group is the biggest FTSE 100 faller this morning by quite some margin.
Shares are down more than 7% after the insurer issued a number of warnings falling Britain’s decision to quit the EU.
Admiral said its solvency ratio had been damaged by the vote, and warned about a weaker economic outlook and interest and exchange rate volatility.
8.39am BST
08:39
US rate rise expectations mount
In the US, comments by Fed policymakers have brought forward expectations of a interest rate rise.
The New York Fed President William Dudley said it was “possible” the central bank could hike rates at its next policy meeting in September as the US jobs market strengthens.
He told the Fox Business Network:
We’re edging closer towards the point in time where it will be appropriate I think to raise interest rates further.
The labor market is getting tighter and we’re starting to see signs of wage gains starting to accelerate, so I think we’re getting closer to that point in time when it will be appropriate to actually raise short-term rates again.
Meanwhile Dennis Lockhart, President of the Atlanta Fed, said the US economy was potentially strong enough to withstand two rate rises before the end of 2016. Addressing the Rotary Club of Knoxville, he said:
I would not rule out September. If the meeting were today I think the economic data would justify a serious discussion. It’s conceivable we could have two rate increases this year.
Early indications of third-quarter GDP growth suggest a rebound. I don’t believe momentum has stalled. I remain confident about prospects in the second half of 2016 and 2017.
Before the comments, market expectations of a US rate hike before the end of 2016 had declined. But according to CMC Markets, Dudley’s comments saw expectations of a move in December climb from 39.1% to 50%.
At 7pm UK time, minutes of the latest meeting of the rate-setting Federal Open Market Committee (FOMC) will be published.
8.06am BST
08:06
European markets open higher
The FTSE 100 is up 23 points or 0.3% in early trading, at 6,916.
7.50am BST
07:50
The FTSE 100 is expected to open slightly higher this morning:
Our European opening calls:$FTSE 6904 up 10$DAX 10687 up 10$CAC 4465 up 5$IBEX 8616 down 6$MIB 16791 down 2
7.47am BST
07:47
The agenda: UK jobless claims to offer Brexit insight
Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business.
The spotlight is on the UK jobs market today. At 9.30am the Office for National Statistics will publish the latest unemployment data.
Much of the data, including the ILO unemployment rate and total number of people out of work, will relate to the three months ending June - before the 23 June EU referendum.
But the claimant count data will reveal how many people claimed unemployment benefit it July, a month after the Brexit vote.
Economists polled by Reuters are expecting a 9,500 jump in claims last month, following a rise of 400 in June.
On the ILO measure, the unemployment rate is expected to remain unchanged at 4.9% in the three months ending June. Wage growth (including bonuses) is expected to pick up slightly to 2.4% from 2.3%.