The UK saw a mixed bag of data yesterday as unemployment rate rose to 3.8% from 3.7% in the 3 months leading to February, mainly down to the number of people on long-term sick rising. There was an uplift in part-time and self-employed people, but the long-term sick outweighed this. However, wage growth was up to 5.9% from 5.7% in the same time period.
Chancellor Jeremy Hunt said of the figures: "While unemployment remains close to historic lows, rising prices continue to eat into pay cheques which is why halving inflation this year is one of our top economic priorities the data releases, particularly wage growth, are closely watched as they have an impact on inflation.
This morning UK inflation figures showed that inflation has come down slightly from 10.4% in February to 10.1% in March, but is still tracking higher than the expected figure of 9.8%. The slower-than-expected number could force the BOE into a further rate hike, to force down inflation, especially now that the UK is expected to avoid recession.
Confidence is growing amongst the CFO’s from the UK’s largest companies where there were 25% more chief financial officers feeling better about the future than worse, compared to 17% more feeling the opposite three months ago. Analysts said that there has not been such a positive swing since the Covid vaccine rollout.
On the back of this some analysts now believe that the UK economy will grow by 0.2% this year, compared to the same analysts believing there would be a 0.7% decline this time 6 months ago.
The CNBC all America economic survey says that 7 in 10 adults hold a negative view on the economy, which is the most downbeat since the survey began 17 years ago.
Treasury Secretary Janet Yellen is scheduled to give a Thursday speech about the U.S.’s economic relationship with China, the Treasury Department said Tuesday, amid tensions between the world’s two biggest economies. The secretary will detail the Biden administration’s “principal objectives” in its relations with China, the Treasury said, including a level playing field for U.S. workers and businesses
If escalated The US to China tensions could put huge pressure on global inflation. ECB president Christine Lagarde believes that inflation could rise by as much as 5% and threaten the leading positions of the dollar and euro.
Disruption to global supply chains would hit “critical sectors” such as the electric-car industry, she said, pointing out that the US is “completely dependent” on imports for 14 critical materials and Europe relies on China for 98 per cent of its rare earths supplies