Merryn Talks Money
UK Wage Inflation, American Euphoria and The Investment Trust Invasion
Dec 18, 2024
Join John Stepek, a seasoned financial journalist and author of the Money Distilled Newsletter, as he unpacks the complexities of UK wage inflation and its unexpected drawbacks. He highlights the buoyant optimism in the US stock market, contrasted with market caution. Stepek also sheds light on the evolving role of investment trusts, discussing their potential challenges and opportunities. Additionally, he dives into undervalued Renewable Energy Investment Trusts, examining how they could flourish in improving market conditions.
19:26
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Quick takeaways
- UK wage growth has accelerated to 5.2%, yet unfilled vacancies indicate ongoing labor market instability and possible interest rate concerns.
- In the US, high investor enthusiasm amid tech stock exuberance raises alarms about market corrections and the impacts of activist investors in investment trusts.
Deep dives
UK Wage Growth and Economic Sentiment
Recent data indicates a noteworthy acceleration in UK wage growth, with a reported increase of 5.2% year on year. This marks the first time in over a year that wage growth has accelerated, resulting in a real wage increase of approximately 3%. Despite this positive figure, there is a prevailing sentiment that the labor market feels shaky, with numerous vacancies remaining unfilled. Economists are now reconsidering their expectations regarding interest rate cuts due to concerns about inflation and the overall economic stability.
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