UK 10-year gilt yields dropped below 4.4%, reaching their lowest level since January 14, after new figures pointed to continued cooling in the labor market, strengthening the case for interest rate cuts from the Bank of England. Data released by the Office for National Statistics showed that average weekly earnings, including bonuses, increased by 4.2% in the three months to December, the weakest growth since the three months to August 2024 and below market expectations of 4.6%. Regular pay, excluding bonuses, rose 4.2%, in line with forecasts. At the same time, the unemployment rate edged up to 5.2%, its highest level since early 2021 and slightly above the 5.1% economists had anticipated, signaling a gradual loss of momentum in the jobs market. Attention now shifts to inflation data due Wednesday. Headline inflation is expected to slow to 3.0% in January, the lowest since March 2025, while core inflation is forecast to ease to 3.1%, marking its lowest level in more than four years.