GBP/USD keeps range around 1.4170 after UK jobless rate unexpectedly drops to 4.8% in March

The Office for National Statistics (ONS) showed on Tuesday, the UK’s official jobless rate dropped further to 4.8% in March vs. the previous 4.9% and 4.9% expected while the claimant count change showed a surprise drop last month.

The number of people claiming jobless benefits showed a decrease of 15.1K in April when compared to +25.6K expected and -19.4K seen previously. The claimant count rate came in at 7.2% vs. 7.2% last.

The UK’s average weekly Earnings, excluding bonuses, arrived at +4.6% 3Mo/YoY in March versus +4.4% last and +4.6% expected while the gauge including bonuses came in at +4.0% 3Mo/YoY in March versus +4.5% previous and +4.6% expected.

Key points (via ONS)

Number of payroll employees remains 772,000 below pre-coronavirus (COVID-19) pandemic levels.

Since Feb 2020, the largest falls in payrolled employment have been in the hospitality sector, among those aged under 25 years, and those living in London.

In February to April 2021, the number of vacancies reached its highest level since January to march 2020.

GBP/USD reaction

GBP/USD keeps the upbeat momentum intact after the headline UK jobless rate surprised to the upside.

The spot was last seen trading at 1.4171, up 0.27% on the day, thanks to the optimism around the UK reopening and broad US dollar weakness.

About UK jobs

The UK Average Earnings released by the Office for National Statistics (ONS) is a key short-term indicator of how levels of pay are changing within the UK economy. Generally speaking, the positive earnings growth anticipates positive (or bullish) for the GBP, whereas a low reading is seen as negative (or bearish).