The UK unemployment rate hit 5.7% yesterday a new six year low, showing the labour market in the UK is healthy and more jobs are being filled. Average earnings, excluding bonuses also rose by 1.7% year-on-year in the last 3 months of 2014. Earnings including bonuses rose at a faster pace, up 2.1%. This is good news for the general public in the UK because the gap between inflation (0.3%) and wage increases is growing. This means that people in the UK have more disposable income in which to spend on goods and services
In other news yesterday, the interest rate vote remained unchanged with all members voting to keep interest rates at the current 0.5% level. However in the minutes released yesterday it states that one policy member believes the Bank of England is as likely to loosen monetary policy as it is to tighten it. So if inflation continues to drop or stay at current low levels it may force the Bank of England to consider cutting rates further to try and drive up prices.
Ratings agency Fitch has said Greece could be dragged back into recession by the uncertainty over its bailout programme. The risks of a policy mistake in the negotiated agreement have risen, it believes, and predicted that Greece’s government will probably have to compromise.
Federal Reserve policy makers judged that risks facing the U.S. economy argued for keeping interest rates near record lows for longer, minutes of their most recent policy meeting showed. The committee, while considering risks to be nearly balanced, pointed to a strengthening dollar, international instability from Greece and Ukraine, and slow wage growth as weakening the case for the first rate rise since 2006.
EUR- 12:30 : ECB Monetary Policy Meeting Accounts
USD- 13:30 :US Initial Jobless Claims expected to fall to 293K from 304K
EUR- 15:00 : Eurozone Consumer Confidence expected to rise to -7.55 from -8.50
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