UK labour market shows more signs of slowing in the second quarter

LONDON, Aug 18 (Reuters) - Britain's ‌labour market ​cooled somewhat ​in the second quarter, which was marked by slowing earnings growth in the private sector and the ‌smallest number of vacancies in more than five years, official ⁠data showed on Tuesday.

Private sector regular earnings — watched by the BoE as ‌a gauge of domestic inflation ‌pressure — rose by 2.8% in the annual terms during the three months to June, marking the weakest growth since the three ​months to October 2020.

While that matched the BoE's own forecast published last month, sterling fell slightly on the data, which ⁠also showed the unemployment rate holding at 4.9%, against expectations in a Reuters poll ​of economists for a drop to 4.8%.

The number of open job vacancies fell to 707,000 in the three ​months to July, down from 711,000 ‌in the three months to July, the Office for National Statistics said. It was the smallest total ⁠since the three months to April 2021. Excluding the pandemic, vacancies are at their lowest since late 2014.

"The labour market picture is little changed ⁠overall, with some softening still evident," ONS Director of Economic Statistics Liz McKeown ​said.

Overall annual earnings growth, excluding bonuses, was 3.5% in the second quarter, the Office for National Statistics said on Tuesday.

Economists polled by Reuters had ‌mostly expected regular wage growth of 3.4%.

The BoE is closely watching whether the energy price jump caused ‌by the Iran war is turning into longer-term inflation pressures in ⁠the economy.

Financial markets on Monday ‌showed one 0.25 percentage-point ​interest rate hike priced by the end of 2026.

(Reporting by Andy Bruce and David Milliken; editing by ‌William James)

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