Archive

Switzerland Unemployment Rate 2.3% (consensus 2.2%) in Mar-24

- Switzerland's unemployment rate for March 2024 was 2.3%, slightly higher than expected and the highest since February 2022.
- The rate is 0.19% above the one-year average, suggesting an unfavourable employment situation through the slightly rising trend.

UK Wage Wealth is an Inflationary Illusion

• Nominal disposable income continues to surge amid widespread enormous pay rises. Unmatched by productivity, the nominal boost is eroded by inflation to real stagnation.
• The regime of high nominal increases nonetheless inflates away the debt stock, helping sustain affordability despite forceful interest rate increases.
• An inflationary reduction in debt burdens is not real wealth. The UK’s net worth is crashing to record negatives as corporates and households suffer post-pandemic.

By Philip Rush

UK Recession Ends Before It Begins

• UK GDP rebounded by 0.2% m-o-m in January 2024, as expected. The retail sector’s seasonal adjustment issue from December was already known to have unwound.
• We currently see GDP growth of 0.3% q-o-q in Q1, restoring the level broadly held since 4Q22. January’s rebound means the recession ended before its February declaration.
• This was never a recessionary regime that could crush inflationary pressures. Its likely end stops that risk from developing, negating that potential need for an early rate cut.

By Philip Rush

UK: Less Excess in the Labour Market

• UK unemployment increased in January 2024, contrary to the consensus, but tracking the rise we forecast for Q1. However, this looks like more than just residual seasonality.
• The underlying changes signal slightly higher unemployment. Meanwhile, vacancies are falling after their seasonal rebound, and redundancies are off their lows.
• Wage growth was also slightly softer than expected. Resilient pay settlements should limit how much further these data slow, postponing rate cuts relative to market pricing.

By Philip Rush