Britain reported a drop of 11.3K in the number of the unemployed, but the wage data is worrying and has the upper hand. Average earnings have slowed to an annual rate of 2.2%. Excluding bonuses, salaries are down to 2.3% y/y. Both are disappointments. The unemployment rate dropped to 4.7% in January, but markets focus on the money.
GBP/USD slips to 1.2215.
The UK was expected to report a small drop of 5K in jobless claims in February. The unemployment rate was predicted to remain unchanged for the month of January: 4.8%. Wages carried expectations for a slower rise of 2.4% after 2.6% in December. Excluding wages, salaries were also predicted to decelerate from 2.6% to 2.5%.
Here is the preview: GBP/USD: Trading the UK Claimant Count Change
GBP/USD was trading at 1.2227 ahead of the publication. Sterling rebounded after suffering from a Brexit blues downfall. The reason for the bounce is still unclear, but there is a clear double-top at 1.2250. Was the bounce related to a leak about a good jobs report?
The bigger event today is clearly the rate decision by the Federal Reserve. Yellen and co. are projected to raise rates. The question is: what’s next? A lot depends on the dot-plot. Here is the full preview: awaiting a “healthy hike”.
Here is the pound/dollar 30-minute chart:
