There was a further boost from the official labour market statistics as the unemployment rate fell to a fresh 43-year low of 4.2% and the jobless total dropped by 16,000 - reversing rises in the number seen over the previous couple of months.
With strong job creation, the labour market has been an economic bright spot for years but pay has been weak and the spike in inflation after the Brexit vote affected living standards.
Latest estimates show that average weekly earnings for employees in Britain in nominal terms increased by 2.8 percent, both excluding and including bonuses, compared with a year earlier.
Britain's annual inflation rate stood at 2.7 percent in February.
Wages are watched closely by economists because consumer spending, one of the key drivers of GDP, is dependent on household...
"Latest estimates... show that the number of unemployed people in the United Kingdom fell by 16,000, leading to a fall of the unemployment rate by 0.1 percentage points", the ONS said.
R Employment rose to a record high between December and February after the economy added 55,000 jobs, the ONS figures showed.
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The return to real terms wage growth will revive hopes for the high street, where retailers have been struggling thanks to the strain on consumers' finances.
The claimant count, which includes people on Jobseeker's Allowance and the unemployment element of Universal Credit, increased by 11,600 last month to 855,300, the highest for more than three years.
But while a May BOE rate increase is all-but priced in by investors, not everyone is convinced that the labor market is running out of slack.
United Kingdom unemployment rate falls from 4.3% to 4.2%.
The wages news came as a report by the Resolution Foundation predicted that falling United Kingdom home ownership rates mean a third of millennials will spend their lives in rented housing. On average, people are still taking home less than they did before the crisis. The think tank calculates such a pattern could see the UK's housing benefit bill for pensioners double to £16 billion (Dh84.2bn) by 2060 from £6.3bn today.
The pound gained 0.2 per cent to $1.4365 as of 9:11am in London after touching $1.4377 earlier, the highest since June 24, 2016.