Payrolled employees rise but underlying earnings growth falls

Main takeaways for markets:

• Payrolled employees increase 160k in October vs September (using the experimental HMRC RTI data). The concern was that this would fall post-furlough (recall this is the first post-furlough release). However, the ONS has cautioned that this number might be flattered a bit by people working out notice periods - but survey data suggests no big increase in redundancies. So downside risks to the labour market reduced, but still wait for next month for more confirmation.
• Underlying regular earnings growth fall from a 4.1-5.6% range to 3.4-4.9% range. Inflation expectations pushing wage growth higher had been a big concern for the MPC. The headline series was a tenth below consensus, but the underlying growth estimate has fallen further. This may give the MPC a bit more breathing space.
• So overall mixed data, but we would focus more on the fall in underlying earnings than the positive payroll data. Markets seem to be doing the opposite, however, with EURGBP over 20 pips lower on the release to its lowest level since November 1st.