Business live: UK wage growth slows, unemployment rate rises
Annual wage growth, excluding bonuses, was slightly higher than expected at 5 per cent in the three months to May, the Office for National Statistics said. Economists had expected the rate would slow to 4.9 per cent from 5.2 per cent in April.
The unemployment rate increased to 4.7 per cent, from 4.6 per cent. This is the highest level since June 2021.
The Bank of England closely watches wage growth for signs of how persistent domestic price pressures are likely to prove, especially after data on inflation in June rose to its highest since January 2024 to 3.6 per cent.
Liz McKeown, director of economic statistics at the ONS, said: 'Pay growth fell again in both cash and real terms, but both measures remain relatively strong by historic standards.
'The number of job vacancies is still falling and has now been dropping continuously for three years.
'The labour market continues to weaken, with the number of employees on payroll falling again, though revised tax data shows the decline in recent months is less pronounced than previously estimated.'
Ministers are said to have made a breakthrough in talks with the Trump administration to cut tariffs on UK steel exports to zero as part of the government's trade deal with the United States.
American officials are understood to have agreed in principle to British proposals that would allow British steel manufacturers to resume tariff-free exports to the US after months of 25 per cent taxes.
The deal is likely to be discussed by Sir Keir Starmer and President Trump when they meet in Scotland next week.
• Read in full: 'Breakthrough' in talks to eliminate US steel tariffs
Wall Street stock market indexes ended modestly higher on Wednesday after a chaotic half hour when news reports suggested President Trump was set to fire Federal Reserve chairman Jerome Powell.
Shortly before midday in America, the benchmark S&P 500 fell 1 per cent, the Nasdaq slid 1.1 per cent, the dollar dropped, and Treasury yields rose after Bloomberg reported the possibility of Trump replacing Powell and Reuters reported that Trump was open to the idea of firing Powell.
Trump was quick to calm markets saying it was 'highly unlikely' he would dismiss the Fed boss, while continuing to criticise Powell for not cutting interest rates. His denial revived equity markets, with the Nasdaq closing up 0.3 per cent at a new high of 20,730.49 for the ninth time so far this year.
Asian stocks rose, and the FTSE 100 is expected to open up 40 points. The dollar strengthened, the gold price weakened, and oil was slightly higher at $68.76 a barrel.
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