UK unemployment shows surprise fall to 4.9% as pay growth drops to lowest in five years

The UK labour market is expected to be hit in the coming months by the impact of the Iran war. Photograph: Andy Rain/EPA

Unemployment in the UK unexpectedly fell in the three months to February, according to official figures – but the fallout from the conflict in the Middle East is expected to cause a rise in job cuts.

The Office for National Statistics (ONS) said the rate of unemployment was 4.9% in February, the lowest level since last summer. This compares with 5.2% in the three months to January, a rate that economists had expected to also see in February.