The rise in average earnings quickened in March so that the year-on-year increase over the first quarter of 2006 was 4.2 per cent, up from a revised 4.1 per cent in the three months to February.
That was still well within the 4.5 per cent "comfort zone" that the Bank of England has said it regards as consistent with its two per cent inflation target.
The increase was entirely due to bonuses, National Statistics reported. Regular pay was only 3.8 per cent higher year on year for the third month in a row, confirming the growing view that the leap in energy prices is not being met with more generous pay deals which could develop into an inflationary spiral.
"The labour market poses little threat to inflation," commented Philip Shaw, chief economist at Investec.
In the money market, short sterling interest rate futures eased downwards, reflecting a sense that the pressure on the Bank of England to raise its official interest rate from the 4.5 per cent, where it has been since last August, are less urgent than they seemed last week.
