Key UK data next week: Labour market's important indicators - Nomura

Analysts at Nomura noted next week's UK Labour market (Weds) and explained that two indicators, in particular, will be under the spotlight in this report.

Key Quotes:

"First and foremost will be average earnings."

"The market focus is on headline annual growth, including and excluding bonuses, averaged over three months."

"If we were to assume earnings grow by 0.2% m-o-m then the ex-bonus 3m annual rate should remain unchanged at 2.1%, while the equivalent inc-bonus number should rise from 2.1% to 2.4% (thanks to a particularly weak April annual rate dropping out of the three-month comparison)."

"Our preference is to focus on private sector regular pay, which has grown by 1.3% over the past four months alone (4% annualised)."

"The second focus is the unemployment rate, which at 4.4% is already below the BoE’s NAIRU estimate."

"We forecast unemployment to remain at 4.4% but see a chance of a further fall to 4.3%."