Despite the increase in unemployment, there was better news from a rise in the number of people in work. The size of the workforce continued to grow, rising by 88,000 to stand at 32.15 million in the three months to December. This was driven by an increase in the numbers of people born in the UK, while there was a drop in workers from eastern Europe. The ONS said there was an increase in the number of full-time employees, and decrease in part-time and self-employed work. John Hawksworth, a chief economist at PwC, said the reading on the labour market was positive because it showed more previously inactive people seeking work, some of them finding jobs and others still searching and so being classified as unemployed.
In the US session Exisiting Home Sales figures were released. Total existing-home sales , which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, sank 3.2 percent in January to a seasonally adjusted annual rate of 5.38 million from a downwardly revised 5.56 million in December 2017. After last month’s decline, sales are 4.8 percent below a year ago (largest annual decline since August 2014 at 5.5 percent) and at their slowest pace since last September (5.37 million).
However, the focus of the session was on FOMC Meeting Minutes. Federal Reserve policymakers expressed a cautious outlook on wage growth amid a "few signs of a broad-based pickup in wage growth," but remained confident that inflation would "move up this year," according to the minutes of the Fed's January policy meeting. "Inflation on a 12-month basis was expected to move up this year and to stabilize around the Committee’s 2 percent objective over the medium term," the minutes showed. "While some participants heard more reports of wage pressures from their business contacts over the intermeeting period, participants generally noted few signs of a broad-based pickup in wage growth in available data,” the minutes showed.
Tomorrow, from the UK, Second GDP figures will be released. Analysts predict 0.5% growth. In the US session Unemployment Claims figures will be published. No changes are expected.
Figures to watch:
Second Estimate GDP (Thursday 10:30)
Unemployment Claims (Thursday 14:30)
