Quotes: US MENA   Enter Symbol: NewsLetter: Search: advanced

UK govt cautious despite dip in unemployment  Join our daily free Newsletter

MENAFN - AFP - 11/09/2013
No. of Ratings : 0
Add to Mixx!



(MENAFN - AFP) Britain's unemployment rate fell unexpectedly in July to the lowest point since late 2012, official data showed Wednesday, but the government warned against over-optimism amid ongoing cuts to state spending.

Unemployment fell to 7.7 percent in the three months to July from 7.8 percent in the three months to June, the Office for National Statistics said in a statement.

That marked the lowest level since the three months to November 2012, adding to recent evidence that Britain was steadily recovering from a long-lasting recession. Market expectations had been for no change.

"Of course it's welcome when unemployment falls but we have got a long way to go," Prime Minister David Cameron said during his weekly question-and-answer session in parliament.

Cameron spoke two days after finance minister George Osborne insisted that recent economic data have vindicated his austerity measures and warned that any backtracking could jeopardise the recovery.

Cameron and Osborne's Conservative party head a coalition government which also comprises the Liberal Democrats.

Business Secretary Vince Cable, himself a member of the Lib Dems, meanwhile used a speech Wednesday to warn over the dangers of "complacency" regarding the country's economic recovery.

"We can't rest on our laurels," Cable told business leaders at a conference at Warwick University, central England.

"The kind of growth we want won't simply emerge of its own volition. In fact, I see a number of dangers. One is complacency, generated by a few quarters of good economic data."

Britain's gross domestic product (GDP) grew by 0.7 percent in the second quarter, upwardly revised data showed last month. Analysts said that the latest unemployment data have helped to confirm Britain's steady recovery.

"The latest labour market data are healthy across the board and helpful to future growth prospects," said Howard Archer, chief UK economist at the IHS Global Insight research group.

"However, underlying earnings growth remains muted."

Analysts were divided on whether the drop in unemployment would force the Bank of England (BoE) to increase record-low interest rates sooner than envisaged.

The benchmark level is being closely watched by markets after the Bank of England recently said it would consider raising its main interest rate once unemployment reached 7.0 percent.

"We expect it to fall to 7.0 percent around the third quarter of 2015," said Archer.

"Consequently, we suspect that the Bank of England could well start to raise interest rates towards the end of 2015."

But Katie Evans, economist at the Centre for Economics and Business Research, said rates would likely rise only in 2016, in line with the BoE's own expectations.

"Although today's data suggest a movement in the right direction, the labour market remains lacklustre. The number of people who worked part-time because they could not find a full-time job has more than doubled over the five years since the crisis, to 1.45 million," she added.

The Bank of England last month announced a major policy shift, as new governor Mark Carney provided clear guidance on when the BoE could be expected to raise record-low borrowing costs.

The British central bank has said it does not plan to raise its key interest rate from its current level of 0.5 percent at least until Britain's unemployment rate falls to seven percent -- providing markets with so-called forward guidance as adopted by the US Federal Reserve.

While the British central bank is forecasting that unemployment will hit a level of 7.0 percent only in 2016, as further deep cuts to state jobs offset workforce growth in the private sector, financial markets believe the BoE will have to raise interest rates sooner.

The British pound rallied following Wednesday's jobs data, a sign that traders believe rates will rise sooner than 2016.

Sterling struck 83.83 pence against the euro -- the highest level since January 23 -- and hit a seven-month peak against the greenback at 1.5287.


 






  MENA News Headlines
 Aug 20 2014 - UAE's Nakheel to repay all its USD2.15 billion debt to banksMENAFN
(MENAFN) Nakheel, the Dubai property developer, is planning to repay all of its bank debt amounting to USD2.15 billion as much as four years ahead of schedule, The Peninsula Qatar reported.The ...

 Aug 20 2014 - ASCOM geology picked to work on Suez projectMENAFN
(MENAFN) Egypt's ASCOM Geology and Mining Company has been chosen to work on a multi-billion dollar project which will expand the Suez Canal by building a new canal next to the original one, Gulf ...

 Aug 20 2014 - UAE'S Al Madina signs settlement deal for debtsMENAFN
(MENAFN) Al Madina for Finance and Investment announced it has signed a settlement deal to pays its debt to Global Investment House, Gulf News reported.The settlement deal states that Al Madina will ...

 Aug 20 2014 - Ex-minister in India refutes love child claimKhaleej Times
(MENAFN - Khaleej Times) A former federal minister has denied the allegation made by a 47-year-old Gujarat-based widow that he had tied the knot with her in 2005 and is the father of her 19-year-old ...

 Aug 20 2014 - Intensive exhaustive household survey stalls TelanganaKhaleej Times
(MENAFN - Khaleej Times) Nearly 400000 government employees teachers and student volunteers began the house-to-house survey at 7am in the city and at 8am in other parts of the state ...

 Aug 20 2014 - Surviving a typhoon in Leyte and rebuilding livesKhaleej Times
(MENAFN - Khaleej Times) Its not yet a year since the worlds most devastating storm reached landfall and while aid workers began pulling out last month recovery efforts are far from over.It has been ...

 Aug 20 2014 - Pakistan army urges talks as protesters await political showdownKhaleej Times
(MENAFN - Khaleej Times) Imran Khan the former cricket star and now chairman of the Pakistan Tehreek-i-Insaaf (PTI) and preacher Tahir Ul Qadri have led days of protests demanding the resignation of ...

 Aug 20 2014 - Yoga guru BKS Iyengar dies of kidney failureKhaleej Times
(MENAFN - Khaleej Times) Iyengar started his yoga school in 1973 in the western city of Pune developing a unique form of the practice that he said anyone could follow.BKS Iyengar the yoga guru who ...

 Aug 20 2014 - Japanese 111-year-old becomes oldest manKhaleej Times
(MENAFN - Khaleej Times) Sakari Momoi a former high school principal who was born on February 5 1903 received a certificate from Guinness World Records confirming the ...

 Aug 20 2014 - Robin Williams suicide not plannedKhaleej Times
(MENAFN - Khaleej Times) Confidante says actor was his usual self the day before Photo: AgenciesA confidante of Robin Williams says he did not plan his suicide.Tmz.com reports that the confidante of ...

more...


 






Google

 
 

Middle East North Africa - Financial Network

MENAFN News Market Data Countries Tools Section  
 

Middle East North Africa - Financial Network
Arabic MENAFN

Main News
News By Industry
News By Country

IPO News
Islamic Finance News
Private Equity News

How-To Guides
Technology Section

Travel Section

Search News

Market Indices
Quotes & Charts

Global Indices
Arab Indices

US Markets Details

Commodoties

Oil & Energy

Currencies Cross Rates
Currencies Updates
Currency Converter

USA Stocks
Arab Stocks
 

Algeria 
Bahrain 
Egypt 
Iraq
Jordan 
Kuwait 
Lebanon
Morocco 
Oman 
Palestine
Qatar 
Saudi Arabia 
Syria
Tunisia 
UAE 
Yemen

Weather
Investment Game
Economic Calendar
Financial Glossary

My MENAFN
Portfolio Tracker

Voting

Financial Calculators

RSS Feeds [XML]

Corporate Monitor

Events

Real Estate
Submit Your Property

Arab Research
Buy a Research

Press Releases
Submit your PR

Join Newsletters


 
© 2000 menafn.com All Rights Reserved.  Terms of Service | Privacy Policy | Contact Us | Advertise | About MENAFN | Career Opportunities | Feedback | Help