UK unemployment unexpectedly rose to its highest level in 2.5 years, while pressures for higher wages in the private sector decreased, reinforcing the belief that inflationary forces are receding.

Unemployment increased to 4.4% in the quarter ending April, the highest rate since mid-2021, according to the UK's Office for National Statistics. Average weekly earnings in the private sector grew by 5.8%, the slowest rate in two years.

These figures may provide policymakers at the Bank of England (BoE) some confidence that upward pressures on wages and prices are beginning to ease. Officials, led by BoE Governor Andrew Bailey, are focusing on the labor market as they consider when they can lower interest rates from their current 16-year high.