VIEW: ING: Not Much In Labour Market Data To Prevent 50bp Rate Hike In Sep

ING note that “the latest UK jobs numbers present a complicated picture for the Bank of England. Job vacancies are falling but labour supply issues remain a challenge, even if there are some encouraging signs that migration is starting to recover.”

• “The Bank of England’s official forecasts point to a material increase in the unemployment rate over the next couple of years, but policymakers will be looking for signs that firms are ‘hoarding’ staff even where margins are squeezed, amid concerns about their ability to rehire again in the future. Wage growth has decent momentum right now, and the committee will be concerned that this could be sustained. In practice, we think wage pressures will begin to cool as margins are squeezed into winter. But for now, we think there’s not much in these latest figures that will stop the Bank of England from hiking rates by 50bp again in September, even if we are nearing the end of the tightening cycle.”