LONDON (Reuters) - LONDON, March 20 (Reuters) - The number of Britons claiming unemployment benefit fell in February to a 20-month low, official data showed on Wednesday, in a boon to the finance minister a few hours before he presents his annual budget.
Separately, minutes of the Bank of England’s March 6-7 policy meeting showed that policymakers are worried about further sterling weakness and remain at an impasse over providing more support for Britain’s stagnant economy.
”The unchanged vote is no surprise. There seems to be a little bit of concern about a weaker currency and I think that was what led to King’s television interview when he said that the pound had fallen far enough.
“On the labour numbers, employment gains is still very good. The worrying thing is how weak earnings growth is, falling to only 1.2 percent year on year.”
“The claimant count number was in line with our expectations. In terms of the unemployment it’s again more of the same, stark contrast between robust UK labour market and week output numbers. It looks like the economy is close to another contraction in Q1. The continue rise in employment is obviously good news for those gaining employment, but the dark side of it is weakness in productivity, the UK is producing less with more is that’s been holding back the Bank of England from potentially more stimulus. Earnings are basically stagnant, inflation is running above 3 percent, it could be another year to forget for the high street.”
“The (Monetary Policy) Committee voted with the same pattern in February, with a 6-3 vote to keep QE on hold. What is a little surprising is that some members seemed very sensitive to movements in sterling and that seems to have been a factor for the ‘on-hold’ camp. Of course, if we get a new remit or a different remit from the Chancellor today, the balance for monetary policy could well change. But there is nothing from today’s minutes that screams out that we are definitely going to get more QE.”
- Lowest claimant count level since June 2011
- Slowest annual rise in regular pay since Oct-Dec 2009