- UK unemployment rises, employers add less jobs
- BoE meeting minutes released
- Fed to unveil meeting minutes
- US housing starts out later
FTSE 100: -0.44%
CAC 40: -0.35%
FTSE MIB: -0.60%
IBEX 35: -0.87%
Stoxx 600: -0.48%
European stocks declined as the UK unemployment rate unexpectedly rose and employers added fewer jobs.
The jobless rate increased to 7.2% in the three months to December from 7.1% the previous quarter. Economists had expected the rate to remain unchanged.
The unemployment rate has been a key factor for the Bank of England (BoE) in shaping its monetary policy. However, it is no longer linked to the BoE's forward guidance of maintaining interest rates at a record low of 0.5% at least until unemployment falls to 7%.
As the jobless rate edged closer to the Bank's threshold faster than expected, Governor Mark Carney changed the forward guidance so as to considerably reinforce the importance of spare capacity in its policy decisions.
The BoE's Monetary Policy Committee (MPC) today released the minutes of its meeting earlier this month which revealed policymakers showed no disagreement about major changes to the central bank's forward guidance policy.
Today's jobs report from the Office of National Statistics also showed employers added 193,000 workers in the quarter to December, below the estimates of 250,000 and the prior quarter's 280,000.
Jobless claims in January dropped 27,600, compared to 27,700 a month earlier, surprising analysts who had expected it to fall by 20,000.
"The latest labour market data showed that there is still plenty of spare capacity in the job market," Capital Economics said.
"Since the minutes of February's MPC meeting confirmed that the Committee is committed to eliminating most of the slack in the economy before tightening policy, the first rise in interest rates still appears to be some way off."
US Fed to release meeting minutes
The US Federal Reserve will today release minutes of last month's meeting when it decided to scale back monthly bond purchases for the second time by $10bn to $65bn.
New Chair Janet Yellen subsequently indicated that the Fed was likely to continue reducing its monetary stimulus after each meeting until ending it all together later this year.
The minutes will shed further light behind the Fed's decision to taper and possibly provide clues as to its next policy move.
Also in the US today is the release of reports including MBA mortgage applications for the week to February 14th and US housing starts for January. Several Fed officials are also scheduled to speak.
PSA Peugeot Citroen rises
PSA Peugeot Citroen gained after saying it plans to raise €5.27bn through share sales and joint ventures and reporting a 2013 loss that was narrower than predicted by analyst.
TF1 declined as the French TV channel reported full-year revenue that fell short of market expectations.
Lafarge and Carlsberg advanced after they both posted fourth-quarter profit that beat analysts' estimates.
Credit Agricole rallied after swinging to a fourth-quarter profit from a record loss a year earlier.
The euro fell 0.07% to $1.3749.
Brent crude futures dropped $0.127 to $110.320 per barrel, according to data from the ICE.