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The pace of wage growth in Britain, which the Bank of England monitors closely to determine the pace of interest rate hikes, accelerated in the three months to November, official data showed on Tuesday.
Wages excluding bonuses rose 6.4% year-on-year in the September-November period, the biggest increase since records began in 2001, barring jumps during the coronavirus pandemic, which has been disrupted by lockdowns and government support measures.
The Office for National Statistics said wages including bonuses also rose by 6.4 percent.
Economists polled by Reuters had expected total wages to rise 6.2 percent and wages excluding bonuses 6.3 percent.
Britain’s unemployment rate stood at 3.7 percent, the statistics office said, near its lowest level in nearly 50 years, in line with most economists’ expectations in a Reuters poll.
The Bank of England is worried that accelerating wage growth will make it difficult to bring down Britain’s high inflation rate, which is currently more than 10 percent.
The Bank of England is expected to raise interest rates for the 10th time in a row early next month, and the key question for investors is how much to increase, amid the BoE balancing the risks of recession and the need to fight inflation.
After the data was published on Tuesday, the British pound rose 0.1 percent on the day against the dollar and the euro.
The data showed that job vacancies fell from October to December for the sixth time in a row, and they also decreased on an annual basis, by 85,000, for only the second time since early 2021 when Britain was under lockdown related to Corona.
