聚焦英国：英国商业重要经济新闻

EconomicsUnited Kingdom Essential UK economic news for businesses ◆Labour market weaknesscontinued at pace in April,butperhaps a tentative sign of improvement in May KEY UK DATA ▲0.7%GDP growth in 3MtoMarch ◆Retail sales demand has picked up,butyet to seeatranslationintobroader consumption ◆Higher than expected inflation complicates both monetaryand fiscal policy ▲3.5%Consumer Price Inflation,Aprily-o-y ▲4.5%Unemployment rate,March Finding signals through the fog It’s beenaperiodof conflicting economic data releases for the UK economy, in part areflection ofthedata beingfor the months either side and includingApril, whichsaw alot of volatility andcould prove a key inflection point for the UK economy. ▼4.25%Bank of England Base Rate On the one hand, labour market indicators for April continued to show weakness in labourdemand. PAYE employment fell 33k and,while that number will likely be revised,nearlyevery sector has reported a decline in vacancies since the start of the year (chart1).Moreover, surveys pointed to a faster pace of headcount reductions and weaker demandfor labour.And,although the labour market has been softeningsince 2022,the higher unitlabour costs associated with a sharp rise in thenational living wageandemployernational insurance contributionshike provided further impetus. However, thosefactorscame into effect in Apriland the PMI employment index was marginally improved in May,solabour market sentiment may, at least, be stabilising. Source:HSBC Emma WilksEconomist, UKHSBC Bank plcemma.wilks@hsbc.com+44 20 3268 5948 Despite weaker employment prospects, retail sales reported a fourthconsecutive monthof growthin Apriland a5.0% rise y-o-y, its strongestpace of growthin three years.Somecaution is needed in taking strong signals from retail salesasoverall householdconsumption growth has struggled to find a footingamid continued rate pass through andcost of livingincreases.However,theupward trend in retail sales demand is in full swing(chart 2),forward-looking components of consumer confidence saw decentgains in May,andnet household deposit growth has continued to slow to more historically normal rates. Inflation surprises make for policy conundrum A plethora ofknownprice rises in April and some surprise underlying price growthsaw headline inflation accelerate to 3.5% y-o-y. More concerningly, services priceinflation jumped to 5.4% y-o-y,higherthan the BoE had forecast.Combined with stillelevated wage growth,initial estimates from PAYE data point towage growth of6.4%y-o-yinApril,whichmeans greater uncertainty over the future path for rate cuts.Indeed, financial markets have pulled back expectations on rate cuts this year (chart3).Longer-dated government bond yieldshavealsocontinued to riseamidglobaluncertainty anda largerisk premium associated with fiscal policy. That raises the riskoflowerfiscalheadroomintheautumnand a‘doom loop’forfiscal policy. HSBC Global Research Podcasts Listen to our insights This report is a summary of previously published content. Any questions,emailAskResearch@hsbc.com Find out more Issuer of report:HSBC Bank plcView HSBC Global Research at:https://www.research.hsbc.com This report must be read with the disclosures and the analystcertifications inthe Disclosure appendix, and with the Disclaimer, which forms part of it. Source:Macrobond, ONS, HSBC Disclosure appendix Analyst Certification The following analyst(s), economist(s), or strategist(s) who is(are) primarilyresponsible for this report, including any analyst(s)whose name(s) appear(s) as author of an individual section or sections of the report and any analyst(s) named as the coveringanalyst(s) of a subsidiary company in a sum-of-the-parts valuation certifies(y) that the opinion(s) on the subject security(ies) orissuer(s), any views or forecasts expressed in the section(s) of which such individual(s) is(are) named as author(s), and anyotherviews or forecasts expressed herein, including any views expressed on the back page of the research report, accurately reflecttheir personal view(s) and that no part of their compensation was, is or will be directly or indirectly related to the specificrecommendation(s) or views contained in this research report: Emma Wilks. Important disclosures This document has been prepared and is being distributed by the Research Department of HSBC and is intended solely for theclients of HSBC and is not for publication to other persons, whether through the press or by other means. This document is for information purposes only and it should not be regarded as an offer to sell or as a solicitation of an offer tobuy the securities or other investment products mentioned in it and/or to participate in any trading strategy. Advice in this documentis general and should not be construed as personal advice, given it has been prepared without taking account of the objectives,financial situation or needs of any particular investor.Accordingly, investors should, before ac