07:01 AM EST, 11/12/2024 (MT Newswires) -- Tuesday's United Kingdom data continued to highlight a steady loosening in labor market conditions, said Sanjay Raja, chief UK economist, at Deutsche Bank.

Wage growth slowed -- though this was a touch above consensus with the all-important AWE Private Regular Pay measure coming in at 4.8% three-month/year over year. Employment fell.

Indeed, there are some cracks appearing in the labor market -- even before Budget measures start to bite, noted Raja.

Vacancies fell for the 30th consecutive month. The Labour Force Survey showed a near 100,000 increase in the unemployment level over the three months to September. The more real-time HMRC payroll data showed a third consecutive month of falling payrolls -- putting the cumulative drop between August and October at 42,000 less.

Big picture, Tuesday's data won't move the dial too much for the Bank of England's Monetary Policy Committee heading into the December decision, stated Deutsche Bank's economist. Wage growth was broadly in line with the MPC's expectations.

Despite some further loosening in the labor market, the MPC will likely want to wait for more data before pushing through another rate cut, according to Raja. Crucially, given the announced increase to employer National Insurance Contributions, the key thing now will be to see how the quantities side of the labor market evolves, including private sector pay settlements.

This could give Deutsche Bank some important clues on how the UK labor market could shift early next year.