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Credit Agricole: comments on UK wage growth

Despite the overall positive trend in UK economy, the weakness in wages growth has remained puzzling, analysts at Credit Agricole say.

"Two possible explanations have been advanced: higher slack in the labour market than previously thought, or alternatively temporary stickiness in wages growth due to the past period of prolonged stagnation. The various surveys tend to give credit to the latter, including the services PMI this week".

 Analysts still believe in an early rate hike by the BoE - supposedly, in Q1 2015. They expect the Inflation report to contain improved forecasts on the economy and inflation. pushing the regulator to hike rates. 

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