Skip to main content

UK unemployment falls and wages push higher

Wages still lag the inflation rate causing a squeeze on the cost of living.

17 February 2022

UK unemployment continues its improving trend, falling 38k in the final quarter of 2021 and while average wages have bumped higher over the year by 3.6%, it is still well below the average inflation rate currently being experienced, so a continual cost of living squeeze for employed and unemployed alike. Still, the healthy jobs market can only push the Bank of England further into more hawkish tilting and markets are now more than convinced that further hikes are coming in the base rate this year with at least six quarter point hikes priced in by December 2022. Such a rapid turnaround in central bank policy is what happens when they find themselves firmly stuck behind the curve, playing catch-up.

Important legal information
The information in this document is given for information purposes only and does not qualify as investment advice. Opinions and assessments contained in this document may change and reflect the point of view of GAM in the current economic environment. No liability shall be accepted for the accuracy and completeness of the information. Past performance is no indicator for the current or future development.

Charles Hepworth

Investment Director
My Insights

Active Thinking

Eurozone inflation eases in February

Charles Hepworth

US Core PCE rises in line with forecasts

Charles Hepworth

Fed wary of cutting US rates too quickly

Charles Hepworth

Charles Hepworth Blog