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You can find the current article at its original source at https://www.theguardian.com/business/live/2017/jun/14/pound-uk-unemployment-real-wages-us-interest-rate-decision-business-live
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| Version 0 | Version 1 |
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| Pound rises ahead of UK unemployment data and US interest rate decision – business live | Pound rises ahead of UK unemployment data and US interest rate decision – business live |
| (35 minutes later) | |
| 9.01am BST | |
| 09:01 | |
| You can get up to speed on the state of Britain’s labour market with these charts from economist Rupert Seggins: | |
| (1/5)The big labour market news was yesterday's inflation rise. Consensus is sub-inflation 2%y/y regular pay growth. New @ONS figs at 9:30 pic.twitter.com/dKiNjw60yX | |
| (2/5) The bigger picture is that the past 10 years have been the worst for pay growth in 155 years. pic.twitter.com/YHBVGA1ayF | |
| (3/5)Lots of attention on recent energy/food/sterling-fuelled inflation, but longer term, earnings and productivity are pretty tied together pic.twitter.com/H0NMDAxhMK | |
| (4/5)The good news is that the UK employment juggernaut continues to rumble on. Consensus is for a 125k increase on the 3 months to January. pic.twitter.com/8eBaHpyp43 | |
| (5/5) Keep an eye on the claimant count rate. Consensus is for it to remain at 2.3%, but it has been rising of late. pic.twitter.com/QBqSeWpBPA | |
| 8.52am BST | |
| 08:52 | |
| The US dollar is under some pressure today ahead of the Federal Reserve decision, which is helping nudge the pound up. | |
| With an interest rate hike today ‘priced in’, traders are focusing on the tone of the decision from the Federal Reserve’s Open Market Committee. | |
| Kit Juckes of French bank Societe Generale expects the Fed to sound cautious about the long-term path for interest rates. | |
| The FOMC’s response is likely to be a ‘dovish hike’ and that’s priced in, to a large degree. Uncertain about how much slack there is in the economy or the labour market, FOCM members are inclined to want to ‘normalise’ rates while they have the chance, but they seem very pragmatic about the longer-term outlook. | |
| So more likely to raise rates now, without overlay hawkish commentary, and then lay the groundwork for another hike in the autumn if markets don’t take fright in the weeks ahead. | |
| 8.38am BST | |
| 08:38 | |
| In the City, the FTSE 250 index - which contains medium-sized UK-focused firms - has jumped by 0.5% in early trading. | |
| Housebuilder Bellway is the biggest riser, up 3.6%, after reporting that customer demand for new homes is still strong. | |
| The blue-chip FTSE 100 index is flat, although its housebuilders (Taylor Wimpey, Barratt and Persimmon) are all rising. | |
| 8.15am BST | 8.15am BST |
| 08:15 | 08:15 |
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| Besides the key news headlines that you’d expect, there’s an at-a-glance agenda of the day’s main events, insightful opinion pieces and a quality feature to sink your teeth into each day. | Besides the key news headlines that you’d expect, there’s an at-a-glance agenda of the day’s main events, insightful opinion pieces and a quality feature to sink your teeth into each day. |
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| 8.13am BST | 8.13am BST |
| 08:13 | 08:13 |
| Pound pushes towards $1.28 | Pound pushes towards $1.28 |
| Sterling is rising in early trading, hitting its highest level since Britain’s shock general election results landed. | Sterling is rising in early trading, hitting its highest level since Britain’s shock general election results landed. |
| The pound has gained a third of a cent to $1.278, as traders brace for this morning’s UK jobs report. | The pound has gained a third of a cent to $1.278, as traders brace for this morning’s UK jobs report. |
| It’s also a little higher against the euro, at just below €1.14. | It’s also a little higher against the euro, at just below €1.14. |
| The possibility that Britain could now seek a ‘softer Brexit’ from the European Union is helping the pound recover. | The possibility that Britain could now seek a ‘softer Brexit’ from the European Union is helping the pound recover. |
| FXTM research analyst Lukman Otunuga explains: | FXTM research analyst Lukman Otunuga explains: |
| Currency investors remained cautiously optimistic over a softer Brexit following last week’s UK election outcome, resulting in a hung parliament. | Currency investors remained cautiously optimistic over a softer Brexit following last week’s UK election outcome, resulting in a hung parliament. |
| Although the political uncertainty in the UK and pending Brexit negotiations are still in focus, much attention will be directed towards the UK jobs report this morning. | Although the political uncertainty in the UK and pending Brexit negotiations are still in focus, much attention will be directed towards the UK jobs report this morning. |
| 7.51am BST | 7.51am BST |
| 07:51 | 07:51 |
| The agenda: UK jobs report and Federal Reserve decision | The agenda: UK jobs report and Federal Reserve decision |
| Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. | Good morning, and welcome to our rolling coverage of the world economy, the financial markets, the eurozone and business. |
| Britain’s cost of living squeeze will be dragged back into the spotlight today, when the latest employment data is released. | Britain’s cost of living squeeze will be dragged back into the spotlight today, when the latest employment data is released. |
| City economists fear today’s figures will show that wages are falling further behind inflation, which has been driven up to 2.9% in May by the weak pound (as we learned yesterday). | City economists fear today’s figures will show that wages are falling further behind inflation, which has been driven up to 2.9% in May by the weak pound (as we learned yesterday). |
| Basic pay rises (excluding bonuses) are expected to have fallen to 2.0% in the three months to April. That would mean real wages have kept falling this year, bringing more pain to struggling families across the country. | Basic pay rises (excluding bonuses) are expected to have fallen to 2.0% in the three months to April. That would mean real wages have kept falling this year, bringing more pain to struggling families across the country. |
| On a more positive note, the unemployment rate may remain at a 42-year low (last month it fell to 4.6% , the lowest since 1975), and the employment total probably kept rising in the last quarter. | On a more positive note, the unemployment rate may remain at a 42-year low (last month it fell to 4.6% , the lowest since 1975), and the employment total probably kept rising in the last quarter. |
| RBC Capital Markets say: | RBC Capital Markets say: |
| Unless last month’s gains somehow turn out to be a total blip, it wouldn’t be too surprising if the level of employment rises again by close to a triple-digit number of thousands in the three months to April. | Unless last month’s gains somehow turn out to be a total blip, it wouldn’t be too surprising if the level of employment rises again by close to a triple-digit number of thousands in the three months to April. |
| The rotation of workers out of part-time roles into full-time employment is now an established theme and if we see this trend once more it would imply that slack is being partially eroded as a result of reduced ‘underemployment’. | The rotation of workers out of part-time roles into full-time employment is now an established theme and if we see this trend once more it would imply that slack is being partially eroded as a result of reduced ‘underemployment’. |
| It’s also a big day for the US economy. America’s central bank, the Federal Reserve, is widely expected to raise interest rates today - to a target range of 1% to 1.25% (from 0.75% to 1%). | It’s also a big day for the US economy. America’s central bank, the Federal Reserve, is widely expected to raise interest rates today - to a target range of 1% to 1.25% (from 0.75% to 1%). |
| Fed chair Janet Yellen will then face the press and give her views on the state of the economy. Wall Street experts predict she’ll try to squash speculation that the Fed is too hawkish. | Fed chair Janet Yellen will then face the press and give her views on the state of the economy. Wall Street experts predict she’ll try to squash speculation that the Fed is too hawkish. |
| As Lew Alexander, chief economist at Nomura, put it (via Marketwatch): | As Lew Alexander, chief economist at Nomura, put it (via Marketwatch): |
| “We do expect her to try to be somewhat forceful in conveying...to market participants that their skepticism over hikes after the June meeting may not be warranted.” | “We do expect her to try to be somewhat forceful in conveying...to market participants that their skepticism over hikes after the June meeting may not be warranted.” |
| Tomorrow at 2:30 p.m. ET: Chair #Yellen hosts live #FOMC press conference: https://t.co/AknBNh2ef4 pic.twitter.com/mOjT9owfyr | Tomorrow at 2:30 p.m. ET: Chair #Yellen hosts live #FOMC press conference: https://t.co/AknBNh2ef4 pic.twitter.com/mOjT9owfyr |
| We also get new eurozone unemployment figures, plus new retail sales and inflation statistics from America. | We also get new eurozone unemployment figures, plus new retail sales and inflation statistics from America. |
| European stock markets are expected to be flattish, as investors hunker down ahead of the Fed decision tonight. | European stock markets are expected to be flattish, as investors hunker down ahead of the Fed decision tonight. |
| Opening Call at @LCGTrading #FTSE -4 points at 7496#DAX +22 points at 12787#CAC +16 points at 5277#EuroStoxx +4 points at 3561 | Opening Call at @LCGTrading #FTSE -4 points at 7496#DAX +22 points at 12787#CAC +16 points at 5277#EuroStoxx +4 points at 3561 |
| Here’s the agenda: | Here’s the agenda: |
| 9.30am BST: UK labour market report | 9.30am BST: UK labour market report |
| 10am BST: Eurozone employment report for Q1 2017 | 10am BST: Eurozone employment report for Q1 2017 |
| 1.30pm BST: US inflation report for May | 1.30pm BST: US inflation report for May |
| 1.30pm BST: US retail sales for May | 1.30pm BST: US retail sales for May |
| 7pm BST: US Federal Reserve interest rate decision | 7pm BST: US Federal Reserve interest rate decision |
| 7.30pm BST: Fed chair Janet Yellen’s press conference | 7.30pm BST: Fed chair Janet Yellen’s press conference |
| Updated | Updated |
| at 8.07am BST | at 8.07am BST |