Pound Sterling gains even as UK Unemployment Rate accelerates

The Pound Sterling recoups some of its early losses against the US Dollar on mixed UK employment data for the three-months ending May.
UK wage growth slowed down, as expected, and the ILO Unemployment Rate accelerated to 4.7%.
US President Trump denied reports stating that he will fire Fed’s Powell soon.

The Pound Sterling (GBP) trades higher against its major peers, except for the US Dollar, on Thursday. The British currency gains after a mixed United Kingdom (UK) job market report, which showed more employment levels but also a higher unemployment rate.

The ILO Unemployment Rate has increased to 4.7%, above expectations and the prior reading of 4.6%. However, the report showed that the number of workers added by employers in the three-months ending May came in higher at 134K than the prior reading of 89K.

Investors were anticipating a weak set of employment numbers as the latest survey from the Recruitment and Employment Confederation trade body and accountants KPMG signaled that the availability of individuals for jobs has increased significantly.

The hiring had been slowed down in recent months as business owners were offsetting the impact of an increase in employers’ contribution to social security schemes announced by the Chancellor of the Exchequer in the Autumn Statement.

Average Earnings (Excluding and Including) bonuses rose by 5% on year, majorly in line with market expectations, but have slowed down from readings seen in the three-months ending April.

Easing Average Earnings, a key measure of wage growth, is expected to offer slight relief to Bank of England (BoE) officials, who have become worried about the inflation outlook, following the release of the hotter-than-projected Consumer Price Index (CPI) report on Wednesday. The report showed that both headline and the core CPI rose at a faster pace on year to 3.6% and 3.7%, respectively.