UK: Unemployment at a new generation (42 years) low of 4.4% - BBH

Analysts at BBH note that the UK unemployment fell to a new generation (42 years) low of 4.4% while the claimant could fell 4.2k; while the June increase was pared to 3.5k from 5.9k.  

Key Quotes

“It was the first decline since February.  The UK economy grew 125k jobs in Q2, which is better than expected (~100), but less than the 175k increase in Q1.   Earnings growth still lags inflation but improved marginally.  Average weekly earnings rose 2.1% (three months, year-over-year) up from a revised 1.,9% pace in May (was 1.8%).  Excluding bonus payment, weekly earnings also rose 2.1%, up from 2.0%.”

“In early European turnover, sterling had been sold off to marginal extend its recent losses.  However the technical support near $1.2840 held.  The timing of the Jackson Hole story and the UK employment data helped lift sterling toward $1.29 (where there is a GBP240 mln option expiring today).  After poking briefly through GBP0.9140, the euro came back offered and did not find a bid until close to  GBP0.9080.    The December 2018 short sterling futures contract is unchanged suggesting that the employment data is not altering views on the trajectory of BOE policy.”