UK regular pay excluding bonuses rose 3.5% year on year in the three months to June, beating a 3.4% forecast and extending a broader cooling trend from the 6.5% peak seen in mid-2023. Total pay including bonuses grew 3.7%, unemployment held at 4.4% and vacancies continued to fall, pointing to softer hiring demand even as the labour market remains resilient. With inflation running at around 2.8% in June 2025, pay is rising faster than prices in real terms, offering some relief to households but leaving the Bank of England cautious that wage growth still above its 2% inflation target could complicate the case for near-term rate cuts. The pound and UK government bond yields showed little immediate reaction.