GBP/USD slips to 3-month low as unemployment rate jumps

GBP/USD slips to 3-month low as unemployment rate jumps

The British pound is down for a third straight trading day on Tuesday. In the European session, GBP/USD is trading at 1.2822, down 0.36% on the day. Earlier today, the pound fell below the 1.28 line for the first time since Aug. 15.

The UK employment report for the three months to September disappointed, as the unemployment rate shot up to 4.3%, up from 4% in the previous reading and above the market estimate of 4.1%. This was the highest level since the three months to May. Unemployment rolls climbed to 26.7 thousand, up from a revised 10.1 thousand but below the market estimate of 30.5 thousand. The BoE meets next on Dec. 19 and the jump in the unemployment rate could raise expectations for a rate cut. Read more…

Pound Sterling slumps on slowing UK labor market

The Pound Sterling (GBP) weakens against its major peers on Tuesday after the employment data from the United Kingdom (UK) showed loosening labor market conditions in three months ending September. The Office for National Statistics (ONS) reported that the ILO Unemployment Rate rose to 4.3% from 4.0% in the three months ending August, higher than estimates of 4.1%. In the same period, UK employers added 219K new workers, fewer than the former release of 373K.

Signs of slowing labor demand have weighed on the British currency even as not all components of the release were GBP-negative. Average Earnings data, a measure of wage growth, grew at a faster-than-expected pace in the three months ending September. Earnings excluding bonuses rose by 4.8%, higher than estimates of 4.7% but slower than the former release of 4.9%. Average Earnings Including bonuses accelerated to 4.3% against expectations and the prior reading of 3.9%. Read more…