First cuts not expected until late summer or early autumn despite evidence jobs market is cooling

• Analysis: Wage rises make early interest rate cut less likely

Persistently strong wage pressure is set to delay a cut in interest rates until well after the election despite mounting evidence that the UK jobs market is cooling, the City believes.

Financial markets indicate that traders expect the Bank of England will hold off reducing the cost of borrowing from 5.25% until it is convinced earnings growth has decisively fallen from levels seen as incompatible with hitting the government’s 2% inflation target.