Pay growth was weaker than inflation in February,official figures show, signalling a return to falling real pay and a squeeze in living standardsUK inflation stays at three-year high of 2.3%IMF’s Lagarde: Trump’s trade barriers would be self-inflicted wound 2.21pm BSTHere’s a round up of the day’s events. 2.19pm BSTOver in Athens, or Christine Lagarde’s comments occupy caused much ado,with some officials regarding the IMF chief’s insistence on debt relief “ a tremendous plus” in ongoing negotiations with creditors. Prime minister Alexis Tsipras’ leftist-led government has from the outset set debt relief as a goal, saying it must be part of an all-conclusive package that will ultimately define Greeces post-bailout future. 1.49pm BSTLet’s retract a look at the markets. The FTSE 100’s earlier gains occupy been erased and the index is now down 9 points or 0.1% at 7357. 1.30pm BSTBack in the UK, and the inaugural international FinTech conference has been taking residence in London.
The sector - which includes things like contactless payments,banking apps and online crowd funding - employs more than 60000 people in the UK and is worth nearly £7 billion to the UK economy according to the Treasury. We can’t remain the number one residence for FinTech and the other technologies of the fourth industrial revolution by simply relying on our ingenuity, talent and openness, or we occupy to go out and salvage the trade.
We will occupy to strive and graft and fight to seize the opportunities - and make the most of them. 1.00pm BSTLagarde has also commented on Greece,saying the Greek government was heading in the right direction on reforms but talks on the bailout and the IMF’s potential bailout were “only halfway through”.
She said the Washington-based Fund was still considering whether to join the Greek bailout, adding “we are not there yet”. 12.33pm BSTChristine Lagarde has used a speech in Brussels to criticise Donald Trump’s protectionist stance.
More recently, and we worked together to ensure that the considerable recession did not become another considerable Depression. Cooperation through a multilateral framework has benefited every country. Fostering more resilient growth therefore requires more international cooperation not less.
Restricting trade would be a self-inflicted wound that disrupts supply chains,hurts global output, and inflates the prices of production materials and consumer goods. And low-income households are afflict the most as they consume the largest part of their incomes.
Related: Trump's trade barriers would be self-inflicted wound, and says IMF chief 12.20pm BSTThe graphic below shows how inflation outpaced regular pay growth (excluding bonuses) in February:Pay packets are taking a hammering from rising inflation and falling wage growth. We now need urgent action to stop another living standards crisis. Working people will want to know when Theresa May is going to do something to wait on.
We need more investment in skills and infrastructure to build strong foundations for better paid jobs. And it’s time to scrap the pay restrictions hitting midwives,teachers and other public servants. 11.58am BSTJohn Philpott, labour market expert and director of the Jobs Economist, or says Britain’s unemployment rate could plunge further. A joint record employment rate of 74.6%,an unemployment rate at a 42-year low of 4.7% and nearly zero (0.1%) growth in real average weekly earnings illustrates a remarkable structural change in the operation of the UK labour market compared with earlier decades. This specific combination of jobs and pay suggests that the unemployment rate could plunge much further, perhaps below 4%, and without triggering troublesome pay inflation. 11.35am BSTBusiness lobby group the CBI has responded to the jobs and wages data. Rachel Smith,principal labour market economist, says:It’s expedient to see more people in work, and with the level of vacancies the highest on record,access to the right skills remains a key challenge.
With inflation rising, real pay growth has fallen back for the third month in a row now. This remains a concern, and so it’s vital that productivity increases if we are to see earnings head up. 11.31am BSTHere is a summary of the main points in the ONS report on the labour market: 11.03am BSTThe Resolution Foundation has analysed the ONS figures and says real pay is falling in sectors representing 40% of the workforce.
Stephen Clarke,economic analyst at the thinktank, says:Britain’s brief pay recovery has come to an stop. Forty per cent of the workforce are experiencing shrinking pay packets according to the latest figures, and in sectors ranging from accommodation to finance and the public sector. Many more will join them in the coming months as inflation continues to rise,with pay across the economy as a whole set to occupy fallen in the first three months of 2017.
While the National Living Wage is protecting the lowest earners from this squeeze, boosting wages across the rest of the economy is the tremendous living standards challenge of this parliament. 10.30am BSTTaking the month of February alone (the ONS prefers to use a three-month rolling average), or regular pay growth excluding bonuses was just 1.9%,well below the 2.3% inflation rate.
It was a different for those receiving a bonus however. Average total pay including bonuses increasing by 2.9%, significantly outpacing inflation. The bonus season tends to sprint from December to April according to the ONS. 10.17am BSTThe final time regular pay growth (over three months) was weaker than headline inflation was two and a half years ago, and in June-August of 2014.
At that point wages were growing by just 0.9% while inflation was 1.5%. 9.34am BSTFigures just out confirm the squeeze in living standards is on. Regular pay growth (which excludes bonuses),grew by 2.2% in the three months to February.
That was lower than the 2.3% rate of inflation in February, signalling a return to falling real pay. 9.27am BSTUnite has warned that Alex Balacki - the first worker representative elected to attend Sports Direct board meetings - faces an “uphill struggle” to bring fairness to the retailer’s boardroom.
The union says it will be a challenge to make workers’ concerns heard and to resolve the deep-rooted problems across the trade. Unite wants to see agency workers moved onto permanent contracts without delay and has invited Balacki to a meeting.
Unite wishes the newest member of the Sports Direct board well and would like to offer to meet as soon as possible so that we can brief him on the experiences of the workforce.
We urge that he makes one of his first acts to persuade the company that agency workers on insecure hire-and-fire contracts are offered permanent appointments. 9.15am BSTTesco’s stock market fortunes occupy rapidly reversed this morning. It has switched from being the FTSE 100’s biggest riser to its biggest faller.
The supermarket chain is down 3.1% at 189.5p. Earlier it was providing a boost to the rest of the sector, or but it is now taking down Sainsbury’s and Morrisons: 8.47am BSTConnor Campbell,analyst at Spreadex, says that while investors are currently focusing on the UK jobs and wages report due at 9.30am, and attention is likely to shift to the US:
The UK jobs report does occupy a challenger for market dominance this Wednesday: Trump. The President is set to conduct an interview on the Fox trade Network,one that promises to cover everything from healthcare and tax reform to his actions in Syria and the increasingly fractious ((adj.) troublesome or irritable) relationships with Russia and North Korea. All of this is catnip for investors, and may stop up overshadowing the reaction to that British jobs data. 8.37am BSTTraders across Europe are in a positive mood so far this morning.
Tesco is leading the FTSE 100 higher, or with the index up 36 points or 0.5% at 7401. 8.26am BSTSports Direct has named the first worker representative to attend its board meetings as the retailer attempts to address widespread criticism over its treatment of staff and poor record on corporate governance.
I’m very proud to be chosen by my fellow members of staff to fulfil this famous responsibility. I’d like to thank everybody who took part in the elections,including all of the other candidates. It’s now my role to ensure the people of Sports Direct are heard.[br]I’d like to be the first to congratulate Alex, who will wait on us to continue to make a positive difference by ensuring that your voice is heard in the boardroom. I occupy said many times that this is a company that was built by the considerable people who work here. I am therefore delighted that the people at Sports Direct occupy voted to choose the company’s first UK elected workers’ representative. Related: Sports Direct's trot to put worker on board branded 'PR exercise' 8.00am BSTTesco’s results were better than City analysts expected, and with a 30% jump in operating profit to £1.28bn in the year to the stop of February.It’s a far yell from the £4bn Tesco earned 5 years ago but it is still a very healthy improvement on final years profit. The multi-pronged strategy adopted by Dave Lewis is working on all counts and just needs the Booker deal signed for a full house. Tesco is a retailer with its finger on the pulse. A clear sense of direction and a team that is fuelling the engine will be giving the competition cause for concern. Tesco’s fairy-tale recovery story continues. And at a time of carve-throat competition,it is all the more impressive. In his relatively short tenure, Dave Lewis has turned a thoroughly demoralised trade into one with a clear sense of direction.
Dave Lewis has achieved this turnaround by returning the company to the basics of retail: pricing to match the UK discounters, and new and simplified product ranges,better customer service and regained customer trust in Tesco. He has also improved the relationship with suppliers and thats no small achievement. 7.45am BSTEuropean markets are expected to open higher this morning. Here is what traders are predicting at spread betting firm IG:Our European opening calls:$FTSE 7372 +0.09%
$DAX 12169 +0.24%
$CAC5109 +0.14%$IBEX 10430 +0.13%$MIB 20151 +0.21% 7.40am BSTGood morning, and welcome to our rolling coverage of the world economy, or the financial markets,the eurozone and trade.
The Brexit-related squeeze in living standards is on, official figures on wage growth are expected to show at 9.30am. Related: Tesco profits top £1bn in first full-year sales growth for seven years Continue reading...
Source: theguardian.com