|

UK unemployment rate ticked down to a new generational low of 4.5% - BBH

UK labor report had something for everyone as the unemployment rate ticked down to a new generational low of 4.5% from 4.6%, notes the analysis team at BBH.  

Key Quotes

“The three-month change in employment rose to 175k.  The median forecast was for the 120k increase.  The claimant count increased by 6k after a 7.5k increase in May.”

“Even earnings were mixed.  At the headline level, they rose 1.8% in the three-months year-over-year period, down from 2.1% in April and in line with expectations.  Excluding bonuses, the pace was a bit stronger than expected at 2.0%, up from a revised 1.8% in April (from 1.7%).”

“Sterling recovered fully from its earlier losses in response to the employment data.  The earlier losses had knocked sterling to almost $1.2810, extending yesterday's drop.  Although BOE Deputy Governor Broadbent did not address his monetary policy views directly in yesterday's speech, in a newspaper interview, he did and he was clear.  He is not ready to endorse a rate hike, though recognizes pressures may be building.  Broadbent seemed particularly sensitive to the high degree of uncertainty or what he called "imponderables."  

“The euro made a new high for the year against sterling today near GBP0.8950 but has reversed course and is returned to GBP0.8900 in late European morning turnover.  Given yesterday's big outside day and the follow through gains earlier, we suspect participants will be more inclined to buy the euro on dips.  A move to GBP0.8860-GBP0.8880 may be seen as such a dip.”

Author

Sandeep Kanihama

Sandeep Kanihama

FXStreet Contributor

Sandeep Kanihama is an FX Editor and Analyst with FXstreet having principally focus area on Asia and European markets with commodity, currency and equities coverage. He is stationed in the Indian capital city of Delhi.

More from Sandeep Kanihama
Share:

Editor's Picks

AUD/USD consolidates above 0.7000; remains close to monthly top

AUD/USD holds steady above 0.7000 during the Asian session on Friday, trading just below the previous day's monthly low amid diverging forces. A hawkish RBA continues to support the Aussie, while the recent decline in US bond yields keeps the US Dollar depressed near a three-week low. However, oil-driven inflation fears reinforce Fed hike bets, which, along with geopolitical risks, could benefit the safe-haven buck and cap the currency pair.

USD/JPY bounces off one-month low; climbs to 157.00 amid reviving USD demand

USD/JPY rebounds from the 156.00 neighborhood, or a one-month low touched during Friday’s Asian session, with bulls looking to extend momentum beyond 157.00 amid the emergence of some US Dollar buying. Meanwhile, Japan's National CPI rose to a nine-month peak and reaffirmed BoJ rate-hike bets, which could support the Japanese Yen and cap gains for the currency pair.

Gold treads water around $4,000

Gold prices maintain its offered stance in place at the end of the week, hovering around the key $4,000 threshold per troy ounce. The persistent selling bias in the precious metal comes amid decent gains in the US Dollar and an acceptable rebound in US Treasury yields across the curve, all alongside further upside traction in crude oil prices.

Crypto Today: Bitcoin holds the 50-day EMA as Ethereum and XRP face structural resistance

Bitcoin gradually ticks up on Friday, trading above $81,000. The Crypto King has recently defended structural support near $80,000, reinforcing the prevailing bullish outlook. Ethereum similarly edges higher above $2,400, while Ripple trades above $1.32 after testing support around $1.30.

The French bond panic is overdone. Here's what the market is misreading 

France's 10-year government bond yield has climbed above 5%, reigniting fears of a sovereign debt crisis in the Eurozone. With public debt exceeding €3.5 trillion, persistent budget deficits and a fragmented political landscape, investors are increasingly questioning the French government's ability to stabilize its finances.

What November 3 means for the Fed's rate path and the US Dollar

The USD faces a decisive period ahead of the November 3 midterm elections. While markets anticipate another interest rate increase from the Fed in December, the battle for control of Congress could reshape fiscal policy expectations and, indirectly, the path of US monetary policy in 2027.