UK Jobs report overview
Early Tuesday, the UK’s Office for National Statistics (ONS) will release the August month Claimant Count figures together with the Unemployment Rate in the three months to July at 06:00 AM GMT.
Although the UK government praises the unlock decision, a divide among the Bank of England (BOE) policymakers and recently mixed economics highlight today’s jobs data as the key for GBP/USD traders. However, the presence of the US Consumer Price Index (CPI) data for August adds an extra filter to the pair’s reaction to the data.
The UK labor market report is expected to show that the average weekly earnings, including bonuses, in the three months to July, eases from the previous 8.8% to 8.2%, while ex-bonuses, the wages are seen declining from 7.4% to 6.8% during the stated period.
Further, the ILO Unemployment Rate favors upbeat signals of the employment data as forecasts suggest easing of the figures from 4.7% to 4.6% for the three months ending in July. It’s worth noting that the Claimant Count Change figures are likely declined -71.7K for August, versus -7.8K prior, while the Claimant Count Rate was 5.7% for July.
How could they affect GBP/USD?
GBP/USD continues the mildly positive performance above 200-DMA, around 1.3830, heading into Monday’s London open. In doing so, the cable pair cheers pullback in the US dollar, as well as recently hawkish BOE comments. It should be noted, however, that the cautious sentiment ahead of the US inflation figures probes the pair buyers amid Fed tapering concerns.
While the UK employment figures are likely to support the BOE hawks, GBP/USD upside needs sustained back-up of the greenback bears to extend the latest recovery moves. As a result, the pair traders will wait for the US CPI for a clearer view before giving a high reaction to the British jobs data.
Technically, the pair seesaws inside a seven-week-old symmetrical triangle. Though, the quote’s ability to stay above the 200-DMA level of 1.3830 as it inches closer to the breakout keeps buyers hopeful. Also backing the upside hopes is the firmer Momentum line.
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).
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