The indicator reflects the number of applications for employment submitted by the unemployed population in the employment centers. The lower is the unemployment rate; the more people get their salary, what causes inflation.
The number of unemployed people is an important signal of the overall situation in the economy, since consumer expenditures are closely related to labor market conditions.
The situation at the labor market has a strong influence on the monetary policy of the Bank of England.
Effect of market
The labor market condition indicators are among the most important ones for the market participants.
Reduction positively characterizes the labor market and is favorable for the pound.