• UK claimant count change +1.1K vs. 2.2K expected.
• Unemployment rate holds steady at 4.3%.
• Wage growth slightly better-than-expected.
• Risk-aversion trade keeps a lid any immediate up-move.
The GBP/JPY cross maintained it’s offered tone and had a rather muted reaction to the latest UK jobs data.
The latest UK employment report showed the number of people claiming unemployment-related benefits rose less-than-expected, by 1.1K in October and the unemployment rate held steady at 4.3%.
Adding to this, average earnings growth, including bonuses, came in slightly better-than-expected at 2.2% y/y in September but did little to provide any fresh impetus, with the cross holding weaker marginally below the 149.00 handle.
Despite the low unemployment level, dismal wage growth further reinforces the BoE projection that UK inflation might be peaking around current levels and seems to be only factors failing to provide a strong boost to the British Pound.
Meanwhile, a fresh wave of global risk aversion trade, with major European equity markets trading with steep losses, was seen boosting the Japanese Yen's safe-haven appeal and further collaborated towards keeping a lid on the cross.
Technical levels to watch
A follow-through selling pressure below mid-148.00s might continue dragging the cross back towards retesting the 148.00 handle en-route to its next major support near the 147.75-70 region.
On the flip side, any recovery attempts back above the 149.00 handle might now confront fresh supply near the 149.30-35 region, which if cleared could lift the cross back towards the key 115.00 psychological mark.
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