BOE Cuts UK Wage Forecast in Half

The Bank of England has halved its forecast for average wage growth, saying it now expects average salaries to rise by 1.25% this year.

The forecast comes as official figures showed average wages excluding bonuses grew by 0.6%.

That is the slowest pace of growth since records began in 2001.

However, the Bank upgraded its growth forecast for this year to 3.5% from 3.4%, and for 2015 it forecast growth of 3%, up from 2.9%.

The Bank’s latest quarterly economic forecast also indicated that it believed the level of spare capacity in the UK economy has narrowed to around 1% of GDP.

In February, it said it believed the amount of spare capacity in the economy was within a range of between 1% and 1.5% of GDP.

via BBC

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza