Warmth in UK wage growth continued to pick up in July despite growing signs that the labor market is slowing.
The latest data released at the start of the European session saw the UK unemployment rate rise to 4.3% in the three months to July from 4.2% previously.
It is the highest figure recorded since September 2021, according to the Office for National Statistics (ONS).
Employment was reported to have fallen by 207,000 more than expected which was the biggest fall since the three months to October 2020.
Despite this, wage growth continued to show an increase to 8.5% year-on-year during the period, exceeding the current inflation rate of 6.8%.
This caused investors to be divided on the next expectation of the steps to be taken by the Bank of England (BOE).
The central bank will meet on Thursday next week, a day after the release of UK inflation data.
With the labor market slowing, and wage inflation rising, it will certainly be difficult for the BOE to make a decision.
However, investors will scrutinize the next data, UK gross domestic product (GDP) to be published in the European session tomorrow.
Initial currency reactions showed the pound little changed with the price remaining flat at around 1.25000 against the US dollar.
