The UK labour market report showed once again job losses and another uptick in the unemployment rate. On the other hand, wage growth remained sticky at high levels with the data beating expectations. Nonetheless, the data was consistent with the BoE's forecasts and therefore it didn't change anything for the market which continues to see a 50/50 chance of a rate cut in June. The central bank is now more focused on the two inflation reports before its monetary policy meeting.
The wage growth figures might have been skewed by the increase in the minimum wage in April. In the big picture though, a cooling labour market should lead to lower wage growth as wages lag the unemployment rate. To sum up, this report doesn't change anything for the BoE or the markets as the focus remains on the CPI figures before the June meeting.
