UK Jobs report overview
Early Tuesday, the UK’s Office for National Statistics (ONS) will release the April month Claimant Count figures together with the Unemployment Rate in the three months to March at 06:00 AM GMT.
Given the expectations of sustained rate hikes by the Bank of England (BOE), coupled with the latest testimony from BOE Governor Andrew Bailey confirming fears of inflation, today’s jobs report becomes crucial to recall the GBP/USD pair buyers. Also highlighting today’s employment numbers is the cable’s recent corrective pullback from a two-year low.
The UK labor market report is expected to show that the average weekly earnings, including bonuses, in the three months to March, may remain unchanged at 5.4% while ex-bonuses, the wages are seen rising to 4.2%, from 4.0% prior, during the stated period.
Further, the ILO Unemployment Rate is likely to remain intact for the three months ending in March. It’s worth noting that the Claimant Count Change figures are expected to improve to -38.8K versus -46.9K previous readouts.
Deviation impact on GBP/USD
Readers can find FXStreet's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined around 20-pips in deviations up to + or -2, although in some cases, if notable enough, a deviation can fuel movements over 60-70 pips.
How could they affect GBP/USD?
GBP/USD cheers softer USD, as well as cautious optimism in the market, to print a three-day uptrend surrounding 1.2350 heading into Tuesday’s London open.
While the recent improvement in British economic growth and firmer inflation data keeps pushing the BOE towards more rate hikes, today’s employment data need to stay in line to keep the GBP/USD buyers hopeful. Also suggesting an initially positive reaction to the likely upbeat data are the latest comments from BOE Governor Andrew Bailey during his testimony to House Finance Committee.
As a result, FXStreet’s Yohjay Elam said, “All in all, UK job figures may boost GBP/USD temporarily, but fail to trigger a more-pronounced upside turn for the currency pair.”
Even so, major attention is given to the Fed’s rate hike and hence today’s US Retail Sales for April and Fed Chairman Jerome Powell’s speech will be more important for the cable traders.
Technically, GBP/USD recently confirmed a falling wedge bullish chart pattern with a clear break above 1.2300, suggesting further advances towards the monthly high surrounding 1.2640. The recovery moves also gain support from the MACD line’s impending bull cross and nearly oversold RSI.
Alternatively, a downside break of 1.2280 will negate the bullish breakout and can drag the quote back to the latest lows surrounding 1.2155.
Key notes
GBP/USD marches towards 1.2350 ahead of UK Employment data
GBP/USD Price Analysis: Bears waiting to take a bite out of bullish correction
GBP/USD regains 1.2300 despite Brexit woes, BOE’s Bailey, focus on UK jobs, US Retail Sales
UK Jobs Preview: Why GBP/USD may offer an early selling opportunity, and when
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).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
GBP/USD stays below 1.2450 after UK employment data
GBP/USD trades marginally lower on the day below 1.2450 in the early European session on Tuesday. The data from the UK showed that the ILO Unemployment Rate in February rose to 4.2% from 4%, weighing on Pound Sterling.
EUR/USD steadies above 1.0600, awaits German ZEW and Powell speech
EUR/USD is holding above 1.0600 in the European morning on Tuesday, having hit fresh five-month lows. The pair draws support from sluggish US Treasury bond yields but the rebound appears capped amid a stronger US Dollar and risk-aversion. Germany's ZEW survey and Powell awaited.
Gold price holds steady below $2,400 mark, bullish potential seems intact
Gold price oscillates in a narrow band on Tuesday and remains close to the all-time peak. The worsening Middle East crisis weighs on investors’ sentiment and benefits the metal. Reduced Fed rate cut bets lift the USD to a fresh YTD top and cap gains for the XAU/USD.
SOL primed for a breakout as it completes a rounding bottom pattern
Solana price has conformed to the broader market crash, following in the steps of Bitcoin price that remains in the red below the $65,000 threshold. For SOL, however, the sensational altcoin could have a big move in store.
Key economic and earnings releases to watch
The market’s focus may be on geopolitical issues at the start of this week, but there is a large amount of economic data and more earnings releases to digest in the coming days.