UK Jobs Weakness Clouds BoE Rate Hikes as Pound Seen Supported Against Dollar
Updated
Updated · Mitrade · Jun 5
UK Jobs Weakness Clouds BoE Rate Hikes as Pound Seen Supported Against Dollar
1 articles · Updated · Mitrade · Jun 5
Summary
MUFG said fresh signs of UK labour-market weakness could undermine any near-term Bank of England rate hike, with attention on a sharp HMRC jobs drop and elevated HR1 redundancy notifications.
HR1 filings show companies planning 20 or more layoffs have picked up in the latest four weeks, reinforcing the softer HMRC signal even as the broader trend has not clearly worsened.
Halpenny said another month of weak data would raise further doubts over imminent tightening, especially if crude oil prices stay at lower levels and ease some inflation pressure.
The bank still expects sterling to find support against the dollar over time because the BoE is likely to show less tolerance for the energy shock despite softer labour data.