Pound falls despite upbeat employment data
|The pound has turned lower once more in the past hour after initially trading near its high of the day following better than expected data on the UK labour market. The FTSE is also trading slightly lower than yesterday’s close, but so far moves in the currency and stock market could be described as subdued and quiet in nature.
UK labour market showing little sign of Brexit shock
The surprise drop in the UK claimant count change to -8.6k for July represents the best monthly performance since March and comes in far below the 5.2k expected. Some analysts had feared an immediate surge in the number of people claiming unemployment benefits following June’s EU referendum, but this morning’s release shows little evidence to support these predictions. The slight miss in average earnings does take some of the shine of the read, but even still, the 2.4% increase exceeded the prior reading of 2.3%. The initial reaction saw the GBPUSD spike higher to 1.3058, but the market failed to break above the top of today’s trading range and subsequently faded back and in fact broke the lower bound within 45 minutes of the release.
FTSE on track for second successive down day
The FTSE 100 is trading in negative territory this morning and appears on track for another day of losses. The release of the upbeat employment figures has seen the index move off its lows but price remains below yesterday’s closing level. Admiral Group is the biggest faller on the benchmark, dropping over 8% after the motor insurance company stock forecast was downgraded by some brokers. Largely due to this the insurance sector is one of the worst performing so far with Prudential and RSA Insurance both beginning their days in the red. Telecommunications stocks have risen in early trade with BT, Vodafone and Dixons Carphone all enjoying positive moves and higher prices on the day at the time of writing. ​
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