Added to this, UK average earnings excluding bonuses rose by a higher-than-forecast 3.6 percent in the three months to May. This was the fastest rise in nominal wages in a decade, and adjusted for inflation real wage growth rose by 1.7 percent in the three months. Including bonuses, wages rose by 3.4 percent following an upwardly revised 3.2 percent in the three months to April. Employment Minister Alok Sharma said of today’s report: “Wages outpacing inflation for 16 months in a row, more people in work than ever before and joint-record female employment, means better prospects for many thousands of UK families and shows the continued resilience of the UK labour market.”
However, the data did little to stop Sterling sliding against the US dollar as Brexit uncertainties and the prospect of political upheaval remain.
Growth in employment slowed to a lower-than-forecast 28,000, the weakest increase since the three months to August 2018 as vacancies slumped to the lowest level in more than a year.
Looking ahead to this afternoon, the US dollar could extend gains against Sterling following the release of the latest US retail sales data.
Economists have forecast that retail sales growth came in at 0.2 percent month-on-month in June. If consumer spending increases by more-than-expected it could dampen expectations for aggressive rate cuts from the Federal Reserve and lend the US dollar support.
However, the pound might be able to claw back some of these losses on Wednesday following the release of the UK Consumer Price Index (CPI).
Rising consumer price pressures would be GBP supportive.