Goldman Sachs Expects UK Unemployment to Remain at 4.3% in October

Goldman Sachs today published a preliminary assessment for the UK's labor market data for October and inflation figures for November. The financial institution expects the unemployment rate to remain stable at 4.3%. Regarding wages, a slowdown in regular private sector pay is anticipated, influenced by compositional effects following a strong September. However, due to a strong base effect, a 0.2 percentage point rise in the annual rate is expected, reaching 5.0% for the three-month period. The overall wage increase in the economy may be driven by a 5.5% pay rise for National Health Service (NHS) workers. As for the November inflation figures, Goldman Sachs predicts a slight decline in services inflation to 4.98%, which is 7 basis points above the Bank of England (BoE) forecast. Core inflation, excluding volatile items such as food and energy, is expected to rise by 14 basis points to 3.45% due to the increase in the annual rate of core goods inflation. Goldman Sachs also projects a rise in headline inflation by 26 basis points, reaching 2.54%, which is 12 basis points higher than the BoE's estimate. This anticipated increase in inflation is partly attributed to the rise in fuel prices and the tobacco tax hike announced in the Autumn Budget.