The UK’s Unemployment Rate dropped below forecast in September, coming in at 4.3% with a previous of 4.5%. The Office for National Statistics latest findings also showed that “in October 2021 there were 29.3 million payrolled employees” which was “up by 160,000 from September 2021”. Their research also proved that in Q3 “the employment rate increased to 75.4% from 75.1% the previous quarter, which was driven by a record high net flow from unemployment to employment”. Total job-to-job moves “also reached a record high, largely driven by resignations rather than dismissal”. This may be due to the fact that new “job vacancies rose to a new record of 1,172,000, an increase of 388,000 from the pre-pandemic level in Quarter 1 (Jan to Mar) 2020”. While this data can be regarded as positive, it did little to affect the Pound, which remained largely flat yesterday.
GBPEUR traded in a tight range on Tuesday and showed little activity in the session. The pair opened the day at 1.1842 and closed not far off at 1.1848.
GBPUSD in contrast made a loss on Tuesday – but this was due to a stronger Dollar rather than Sterling weakness. Cable started the day at 1.3469 and closed at 1.3428.
The USD started the Europe session strong after the currency hit “fresh 16-month highs during the Asian session”. Economists agree that the Dollar’s strength has been aided by the markets anticipation of “faster monetary-policy tightening by the Fed and reinforced by recent US economic data”. Not only this, many experts have “noted that the protracted COVID-19 wave in Europe is providing a greater demand for safe havens”.
EURUSD suffered a dip yesterday as result of Dollar demand. The pair opened at 1.1373 and closed at 1.1333.
On the data front, at 07:00 the UK printed October’s Inflation numbers. Core Inflation YoY came in at 3.4%, while the Inflation Rate YoY was released at 4.2%. At 10:00 the Eurozone will also be printing their monthly Inflation data.
