Wages breaking out in a big way in the UK. https://www.investing.com/news/economic-indicators/uk-hiring-surged-in-june-as-economy-bounces-back--ons-2558657 . Average weekly earnings in the three months to the end of May rose by 7.3% compared with a year earlier. The ONS estimated underlying wage growth, excluding distortions caused by the pandemic, was between 3.9% and 5.1% for average weekly earnings. For average earnings excluding bonuses it was between 3.2% and 4.4%. . Expectations for inflation are relatively low. Lessons of the past are easily forgotten. More money chasing the same goods. Wage rises are sticky. Will see how the following prediction pans out. . Data earlier that day showed inflation hit 2.5% in May due to higher oil prices and bottlenecks as the economy reopened - a sharper rise than the BoE had been forecasting. Ramsden said British inflation might rise as high as 4% "for a period later this year" - double the BoE's target - and the factors driving it up might take some time to ease off. . If the Aussie government insists on keeping wages growth low in Australia while consumers absorb rising inflation, we will end up with a brain drain. Has happened before and will happen again. As mortgage rates begin to rise, pressure will mount. I suspect the only way the government will notice is when budgets for change rooms, swimming pools and car parks begin blowing out.
