GBP/JPY holds gains around 199.00 following UK employment data
|- GBP/JPY remains stronger after mixed UK labor figures were released on Thursday.
- The UK Unemployment Rate rose to 4.7%, while the Employment increased by 134,000 in the three months to May.
- Japan’s Merchandise Trade Balance Total showed a surplus of JPY 153.1 billion in June, against expected JPY 353.9 billion surplus.
GBP/JPY retraces its recent losses registered in the previous session, trading around 199.00 during the early European hours on Thursday. The currency cross remains stronger despite mixed employment figures from the United Kingdom (UK).
The UK ILO Unemployment climbed to 4.7% in the three months to May, against the market expectations of remaining unchanged at 4.6%. Meanwhile, the Employment Change came in at 134K, against the 89K in April. Claimant Count Change showed that the number of people claiming jobless benefits increased 25.9K in June, compared with a revised increase of 15.3K in May, above the expected 17.9K figure.
The GBP/JPY cross also draws support as the Japanese Yen (JPY) struggles following disappointing trade figures that fueled concerns about a potential technical recession. Meanwhile, investors are watching for potential fiscal stimulus ahead of the July 20 Upper House election, amid speculation about increased government spending and a possible consumption tax cut to support economic growth.
Japan’s Merchandise Trade Balance Total reported a trade surplus of JPY 153.1 billion in June, following a JPY 638.6 billion deficit in May and well below market expectations of a JPY 353.9 billion surplus. Exports declined 0.5% year-over-year, against the previous decline of 1.7%. The reading missed forecasts of a 0.5% gain, marking a second straight monthly decline. Meanwhile, imports rose 0.2%, recovering from the previous decline of 7.7% and better than the expected 1.6% decline.
(This story was corrected on July 17 at 08:00 GMT to say, in the second bullet, that the Employment increased by 134,000, not the Employment Rate.)
Economic Indicator
ILO Unemployment Rate (3M)
The ILO Unemployment Rate released by the UK Office for National Statistics is the number of unemployed workers divided by the total civilian labor force. It is a leading indicator for the UK Economy. If the rate goes up, it indicates a lack of expansion within the UK labor market. As a result, a rise leads to a weakening of the UK economy. Generally, a decrease of the figure is seen as bullish for the Pound Sterling (GBP), while an increase is seen as bearish.
Read more.Last release: Thu Jul 17, 2025 06:00
Frequency: Monthly
Actual: 4.7%
Consensus: 4.6%
Previous: 4.6%
Source: Office for National Statistics
The Unemployment Rate is the broadest indicator of Britain’s labor market. The figure is highlighted by the broad media, beyond the financial sector, giving the publication a more significant impact despite its late publication. It is released around six weeks after the month ends. While the Bank of England is tasked with maintaining price stability, there is a substantial inverse correlation between unemployment and inflation. A higher than expected figure tends to be GBP-bearish.
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