GBP Drops Against JPY After Mixed Labour Data

The British Pound (GBP) has dropped to near 208.60 against the Japanese Yen (JPY) on Tuesday, following the release of UK labor market data for the three months ending July.

The Office for National Statistics (ONS) reported that the ILO Unemployment Rate remained steady at 4.9%, while a decrease was expected to 5%. The economy created 67K fresh jobs in the quarter ending July, lower than the 83K in the previous three months.

Average Earnings Excluding Bonuses rose steadily by 3.5% Year-on-Year (YoY), as expected, while Including Bonuses grew slower at 3.9%, down from the revised higher reading of 4.2% in the previous period.

Strategists at Scotiabank noted that market participants look to Thursday's Bank of England (BoE) policy decision for guidance on interest rates, where a hawkish hold while leaning towards a 25bpt hike at the next meeting in early November is expected.