Closing summary
Time for a final recap.
A worrying rise in companies collapsing last month shows that many UK firms are in a “perilous” position as 2024 draws to an end.
New data from the Insolvency Service this morning shows there was a 13% increase in registered company insolvencies in England and Wales in November, to 1,966.
That may intensify concerns that the economy is weakening, following data yesterday showing firms are cutting staff this month.
UK pay growth accelerated to 5.2% in October, putting pressure on the Bank of England to resist calls for lower interest rates when policymakers meet later this week.
The Office for National Statistics (ONS) said annual growth in employees’ average earnings – which had been slowing for more than a year – jumped after a significant rise in wages paid for skilled workers in the manufacturing sector.
Wages rose 4.4% including bonuses and 4.9% excluding bonuses in the three months to September, but both hit 5.2% in the three months to October.
The rise in pay for factory workers to 6% meant the split between civil servants and private sector employees widened. Annual average regular earnings growth was 5.4% for the private sector and 4.3% for the public sector, the ONS said.
Our other main stories today:
Thank you for reading. We’ll be back tomorrow. Take care! – JK
In Canada, inflation dipped below the central bank’s 2% target in November, driven by Black Friday discounts, which should reverse this month.
Headline inflation, as measured by the annual change in the consumer prices index, dropped to 1.9% from 2% in October, official figures showed.
Thomas Ryan, North America economist at Capital Cconomics, said:
The Bank will probably choose to look through the decline in headline inflation, given it was supported by temporary factors.
It cannot do the same, however, for the second consecutive strong 0.3% month-on-month gains in the CPI-trim and CPI-median measures, given they excluded the large price falls in the consumer goods-related components (and the jump in travel services). The 3-month annualised rate for the average of the two is now at 3.3%, above the upper limit of the Bank’s 1% to 3% target range.
We do not think this is enough for the Bank to call time on its easing cycle but, paired with the recent pick-up in some of the activity data, it confirms that the Bank will start moving in smaller 25bp increments and raises the chance of a pause at the meeting next month.
