Record UK wage growth pushes the Pound higher, could the Pound continue to climb?

The Pound is in the financial headlines today after reaching a 15-month high against the US Dollar this morning, after some stronger than expected wage growth data has given the Pound a boost.

The Pound to US Dollar exchange rate, known as cable within the currency markets has hit a high of  1.2913 this morning, which is the highest level since April the 25th last year. The Pound has also broken back above 1.1700 against the Euro which is within 0.5 cents from the 11-month high so once again we’re seeing GBP exchange rates climb off the back of economic data releases in the UK.

Wages growth within the UK rose at a faster rate than markets expected in May according to the data released this morning. City analysts had expected to see a rate of 7.1% but the figure released was 7.3% which is the highest rate on record outside of the pandemic period, which was a time where many might argue that the figures were skewed.

This increase adds further pressure on the Bank of England to once again hike interest rates at their next opportunity, which will be on the 3rd of August. This would be the 14th consecutive interest rate hike as the Bank of England attempts to reduce the rate of inflation within the UK which is the highest in the developed world.

The expectation of further hikes is behind the Pound climbing, so if you’re following the Pound’s value economic updates such as wage growth, inflation levels and of course interest rates are all data releases that can impact Sterling’s value.

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GDP figures, Industrial and Manufacturing figures will all be releases early on Thursday morning which are the next potential market movers.