LONDON — Stronger-than-expected UK labour market data has increased expectations that the Bank of England could raise interest rates at its November 5 meeting.
Official figures released on Tuesday showed that the number of employees on payrolls rose, unemployment fell and average hourly earnings grew faster than expected in the three months to August.
The data strengthened the pound against both the US dollar and the euro. Financial markets were pricing in the possibility of a quarter-percentage-point rate increase next month.
However, economists cautioned that the decline in job vacancies points to weaker demand for labour. They also noted that higher energy prices and developments in the Middle East could influence the Bank of England’s decisions.
A rate increase has not been confirmed. The central bank will assess inflation, employment and wider economic conditions before making its next policy decision.
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