UK Unemployment Rate Drops

(RTTNews) - The UK unemployment rate dropped in the three months to April and wages grew more than expected, official data revealed Thursday.

The jobless rate fell to 4.9 percent in the three months to April from 5.0 percent in the three months to March, the Office for National Statistics said. The rate was expected to remain unchanged at 5.0 percent.

Including bonuses, average earnings climbed 4.4 percent in the three months to April, the same rate as seen in the preceding period, and stronger than economists' forecast of 4.0 percent.

At the same time, average earnings excluding bonuses grew 3.4 percent from the previous year. This was the slowest since October 2020, when earnings were up 2.8 percent. Economists had forecast an annual increase of 3.3 percent.

Payroll employment decreased by 119,000 from the previous year in May, but rose 2,000 from April to 30.3 million, the ONS said.

ING economist James Smith said jobs report does not look so bad as the unemployment rate ticked down and payroll employment increased after three consecutive monthly declines.

The report is another reminder that the case for higher interest rates is far from clear-cut, he noted. The economist expects the Bank of England to keep interest rates on hold this year and return to rate cuts in 2027.

The BoE is set to announce its monetary policy decision later today. Markets anticipate the BoE to maintain its benchmark rate at 3.75 percent, the lowest since June 2023.