UK jobless rate unexpectedly drops to 4.7% in June, GBP/USD uninspired

  • UK claimant count change arrived at -7.8K in July.
  • The unemployment rate in the UK dropped to 4.7% in June.
  • The UK wages excluding bonuses rose by 7.4% YoY vs. 7.4% expected.

The Office for National Statistics (ONS) showed on Tuesday, the UK’s official jobless rate surprised markets to the upside, by arriving at 4.7% in June vs. the previous 4.8% and 4.8% expected while the claimant count change showed a small drop last month.

The number of people claiming jobless benefits showed a drop of 7.8K in July when compared to -114.8K seen previously. The claimant count rate came in at 5.7% vs. 5.8% last.

The UK’s average weekly earnings, excluding bonuses, arrived at 7.4% 3Mo/YoY in June versus +6.6% last and +7.4% expected while the gauge including bonuses came in at 8.8% 3Mo/YoY in June versus +7.3% previous and +8.7% expected.

Key points (via ONS)

UK job vacancies surge, above a million for the first time in July.

UK Q2 output per hour worked was 0.6% above pre-pandemic levels.

UK Q2 output per hour worked -0.5% QoQ.

GBP/USD reaction

GBP/USD stalls the bounce above 1.3800 despite the upbeat UK jobs report.

The spot was last seen trading at 1.3820, down 0.21% on the day, as the focus shifts to the US Retail Sales data and Fed Chair Powell’s speech.

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).

 



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