UK Jobs report overview
The UK labor market report, scheduled for release at 0830 GMT, is expected to show that the number of people seeking jobless benefits decreased by 2.1K during the month of June as compared to a decline of 7.7K in the previous month. Meanwhile, the unemployment rate is expected to hold steady at 4.2% in the three months to May.
Conversely, average weekly earnings, including bonuses are expected to remain unchanged at 2.5% y/y in the three months to May. Excluding bonuses, the wages are seen ticking lower to 2.7% in the reported period, down from 2.8% previous.
How could they affect GBP/USD?
Yohay Elam, FXStreet's own Analyst explains, “if it comes out at higher than expected with a relative deviation of 1.09 or higher(2.95 or higher in actual terms), the pair may go up reaching a range of 42 pips in the first 15 minutes and 84 pips in the following 4 hours.”
He further adds: “If it comes out lower than expected at a relative deviation of -1.33 or less(2.83 or lower in actual terms), the GBPUSD may go down reaching a range of 48 pips in the first 15 minutes and 88 pips in the following 4 hours.”
GBP/USD levels to watch
Immediate resistance is pegged near 1.3275 level and is followed by July 10 high level of 1.3305, above which the pair is likely to aim towards 1.3363 area, near three-week tops set last week.
On the flip side, the 1.3200 region now seems to protect the immediate downside, which if broken might turn the pair vulnerable to head back towards testing the 1.3110-1.3100 support before eventually dropping to YTD low level of 1.3050, set on June 28th.
Key Notes
• How to trade the UK jobs report with GBP/USD
• Market themes of the Day: UK wages and Powell’s testimony headline the day
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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