When are the UK wages and how could they affect GBP/USD?

Dhwani Mehta FXStreet

UK Jobs report overview

The UK labor market report is expected to show that the average weekly earnings, including bonuses, in the three months to October, are expected to remain unchanged at 3.0%, while ex-bonuses also, the wages are also seen steadying at 3.2% in the reported period.

The number of people seeking jobless benefits increased 20.2k in the three months to October. The ILO unemployment rate is expected to hold steady at 4.1% during the period.

How could they affect GBP/USD?

A drop in the UK’s wages could trigger fresh selling in the pound while markets await the meeting between the UK PM May and the European leaders later on Tuesday. The rates could test the 1.2508 (multi-month lows) on a negative surprise. A break below the last, a test of the 1.2450 level remains inevitable.

On upbeat readings, the GBP/USD pair could extend the bounce to test the 1.26 handle, above which the immediate resistances lie at 1.2650 (psychological resistance) and 1.2673 (5-DMA).

“…the total pay is also expected to accelerate to 3.0% y/y in three months ending in October, up from 2.7% y/y. Strong pay increases reported in the November UK labor market report are set to support Sterling on the currency market only temporarily as prospects of no-deal Brexit have become increasingly likely as the UK Prime Minister Theresa May canceled the UK parliament voting on Brexit deal on December 11 and rather opted for another round of discussions with the EU. ”, Mario Blascak (PhD), Editor-in-Chief at FXStreet explains.

Key Notes

Market themes of the Day: The judgment day for the Brexit deal in parliament delayed indefinitely

GBP/USD to face earnings data with Brexit vote off the table

GBP/USD Analysis: Struggles near 20-month lows as UK PM May seek changes in backstop with EU

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).

Author

Dhwani Mehta

FXStreet

Residing in Mumbai (India), Dhwani is a Senior Analyst and Manager of the Asian session at FXStreet. She has over 10 years of experience in analyzing and covering the global financial markets, with specialization in Forex and commodities markets.

EUR/USD meets initial support around 1.1800

EUR/USD remains on the back foot, although it has managed to reverse the initial strong pullback toward the 1.1800 region and regain some balance, hovering around the 1.1850 zone as the NA session draws to a close on Tuesday. Moving forward, market participants will now shift their attention to the release of the FOMC Minutes and US hard data on Wednesday.

GBP/USD bounces off lows, retargets 1.3550

After bottoming out just below the 1.3500 yardstick, GBP/USD now gathers some fresh bids and advances to the 1.3530-1.3540 band in the latter part of Tuesday’s session. Cable’s recovery comes as the Greenback surrenders part of its advance, although it keeps the bullish bias well in place for the day.

Gold remains offered below $5,000

Gold stays on the defensive on Tuesday, receding to the sub-$5,000 region per troy ounce on the back of the persistent move higher in the Greenback. The precious metal’s decline is also underpinned by the modest uptick in US Treasury yields across the spectrum.

Ethereum Price Forecast: BitMine extends ETH buying streak, says long-term outlook remains positive

Ethereum (ETH) treasury firm BitMine Immersion continued its weekly purchase of the top altcoin last week after acquiring 45,759 ETH.

UK jobs market weakens, bolstering rate cut hopes

In the UK, the latest jobs report made for difficult reading. Nonetheless, this represents yet another reminder for the Bank of England that they need to act swiftly given the collapse in inflation expected over the coming months.

Ripple slides to $1.45 as downside risks surge

Ripple edges lower at the time of writing on Tuesday, from the daily open of $1.48, as headwinds persist across the crypto market. A short-term support is emerging at $1.45, but a buildup of bearish positions could further weaken the derivatives market and prolong the correction.