Read between the lines
Today's news headlines:
‘UK job vacancies fall in early sign labor market may weaken’. Further evidence that the UK economy may be weakening came with this morning’s labour data, with a reduction in new jobs created and a record fall in inflation-adjusted wages. Other measures remained tight, with the headline Unemployment Rate unchanged at 3.8% while the number of new employees rose 73k in July. Still, with the Bank of England warning that unemployment could top 6% with the cost-of-living crisis, this report will do little to ease the pressure on the UK government to help support households. (Bloomberg)
‘Sunak vows to shake up ‘bloated’ civil service as UK Premier’. Yesterday, former Chancellor Rishi Sunak, pledged to create a ‘sharper, leaner civil service’ if chosen as the UK’s next Prime Minister. Back-office numbers will be slashed, and senior civil servants will need to spend at least a year of their careers working secondment outside of Whitehall or in the industry to avoid ‘groupthink’. Sunak continues to lag behind Liz Truss—who has already committed to civil service reforms—in the polls as they both vie for a share of the 170,000 voting Conservative Party members. Voting is already underway, with the winner announced on the 5th of September. (Bloomberg)
Yesterday’s US manufacturing data pointed to a sharp downturn, while homebuilder sentiment also declined. Treasuries rose on greater demand for havens, and oil dipped below $89 a barrel on worries of weaker demand. A gauge of Dollar strength continued to march higher, putting pressure on both the EUR/USD and GBP/USD currency pairs.
UK Average Earnings Index 3m/y: 5.1% vs 6.4% previously
UK Claimant Count: -10.5k vs -26.8k previously
UK Unemployment Rate: 3.8% vs 3.8% previously
ZEW and German ZEW Economic Sentiment: 10.00am
Canada CPI m/m: 1.30pm
US Industrial Production: 2.15pm
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