Skip to content
GBPUSD Holds Steady Amid Mixed Employment Data

GBPUSD Holds Steady Amid Mixed Employment Data

OneRoyal Animated Banner 970 x 90

In Tuesday’s European trading session, GBPUSD hovers around 1.3100 threshold. The UK’s ILO Unemployment Rate fell to 4.1% for the three months ending in July, aligning with market expectations and providing initial support to the Pound Sterling. However, the ongoing strength of the US Dollar limited further gains for the currency pair.

GBPUSD Chart

GBPUSD Holds Steady Amid Mixed Employment Data

Persistent Bearish Sentiment for GBPUSD

Kicking off the week in negative territory, GBP/USD continued to decline during the Asian session before hitting a low of 1.3058, a figure not seen in nearly three weeks. Although the pair managed a modest recovery, technical indicators suggest a continued bearish outlook in the near term.

UK Economic Indicators and Their Impact

The Office for National Statistics revealed a decrease in the unemployment rate, which was accompanied by a significant increase in employment figures to 265,000 from a previous 97,000. Meanwhile, wage growth excluding bonuses slowed to 5.1% from 5.4%. These employment figures lent some support to the Pound, though an overall risk-averse market mood, reflected in a 0.5% decline in the FTSE 100 Index, kept the currency pair subdued.

US Economic Influence and Upcoming Data

The absence of major US economic data releases on Tuesday left the GBP/USD vulnerable to the prevailing cautious sentiment. Investors are likely to focus on the upcoming US Consumer Price Index (CPI) data, scheduled for release on Wednesday, which could influence future movements in the currency.

Employment and Economic Activity Trends

Provisional estimates for August 2024 showed a monthly decrease of 59,000 in payrolled employees, although there was an annual rise of 122,000. The UK employment rate for people aged 16 to 64 was 74.8%, with a slight quarter-on-quarter improvement. Meanwhile, the unemployment rate for those over 16 years was 4.1%, reflecting a decrease.

Broader Economic Context and Implications

The economic inactivity rate decreased to 21.9%, while the Claimant Count rose to 1.792 million in August 2024, partly due to policy shifts affecting job search requirements. Despite a continued decrease in vacancies, they remain above pre-pandemic levels. Real-term wage growth adjusted for inflation showed an increase, highlighting ongoing labor market challenges. Labor disputes accounted for 42,000 lost working days in July, mainly within the health and social work sectors.

EUR/USD Navigates Below 1.1050 Amid Cautious Market

The EUR/USD pair defended bids under 1.1050 during the European session, struggling against a strong US Dollar supported by reduced expectations of a 50 basis point rate cut by the Federal Reserve. Despite a bearish close last week and further losses on Monday, the pair steadied around 1.1050 as investors awaited key economic events.

Gold Holds Firm Near $2,500 as Rate Cut Expectations Wane

Gold traded near the $2,500 mark on Tuesday, maintaining its recent range as market participants evaluated the prospects of US monetary policy changes. Mixed US employment data cast doubt on a significant rate cut by the Fed, affecting Gold’s appeal as a non-yielding asset. Investors now keenly await US CPI and PPI figures for further insights into inflation and interest rate prospects.

Disclaimer:

All information has been prepared by TraderFactor or partners. The information does not contain a record of TraderFactor or partner’s prices or an offer of or solicitation for a transaction in any financial instrument. No representation or warranty is given as to the accuracy or completeness of this information. Any material provided does not have regard to the specific investment objective and financial situation of any person who may read it. Past performance is not a reliable indicator of future performance.

Author

  • Phyllis Wangui

    Phyllis Wangui is a Financial News Editor with extensive knowledge of the forex, stock news, stock market, forex analysis, cryptos and foreign exchange industries. Phyllis is an avid commentator on these topics and loves to share her insights with others through financial publications and social media platforms.

    View all posts SEO Editor
MultiBank Group Bonus