MNI European Morning Briefing

     LONDON (MNI) - The pace of releases slows somewhat on Wednesday, but UK

jobs data and EMU growth numbers will dominate the morning session.

     The UK June Labour Market Survey will be published at 0830GMT.

     Falling to 4.5% in May, the UK unemployment rate hit a level not seen since

1975. A month later, the chances of this feat being beaten appears to stand at

fifty-fifty, with just as many analysts expecting the rate slipping to 4.4% as

those who see it holding steady at 4.5%.

     Should Wednesday's data reveal the unemployment rate fell to 4.4% in June

this would be the lowest level of joblessness in the UK since the three months

to June in 1975, a 42-year low.

     Either way, the figures will almost certainly point to a continued

evaporation of labour market slack. That should, in theory, lead to inflationary

pressure on the wage front but this has so far been absent with real earnings

lingering in sub-zero territory instead.

     The general consensus is that this lack of movement is expected to have

carried forward into June.

     Average wage growth, on both total and ex-bonus terms, are forecast to come

in unmoved from the level set in May. That is, for 1.8% 3m y/y growth in total

earnings and 2.0% 3m y/y growth in earnings ex-bonuses.

     At 0900GMT, the euro area GDP flash numbers will be released, with

expectations for the strongest reading in a while, with analysts looking for a

print of 2.1%, in line with the preliminary flash data.

     Across the Atlantic, the US calendar gets underway at 100GMT, with the

publication of the MBA weekly applications index.

     The US July housing starts data and the latest NY Fed Business Leaders

Survey will be released at 1230GMT.

     The seasonally adjusted pace of housing starts is expected to accelerate to

a 1.220 million annual rate in July after a large increase in June. A jump in

June building permits provides some upside risk. Total starts were up 4.7%

year/year before seasonal adjustment in June, while permits were up 6.6%, but it

remains to be seen if that pace can be maintained.

     At the same time, the International Canadian Transaction in Securities data

will be published.

     The Atlanta Fed inflation index will be published at 1400GMT, with the DOE

weekly crude oil stocks data expected at 1430GMT.

     At 1800GMT, the Federal Reserve will releases the minutes from the July

25-26 FOMC meeting.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com