Pound Takes a Hit as UK Jobs Data Fails to Impress
The Pound to Euro exchange rate weakened on Tuesday after the latest UK labour-market data pointed to a further cooling in employment conditions.
At the time of writing, GBP/EUR was trading at around €1.1684, down approximately 0.1% on the day and below Monday’s close near €1.1697.
The unemployment rate held at 4.9% in the three months to June, above consensus forecasts for a decline to 4.8%. Job vacancies fell to 707,000 in the three months to July, their lowest level since 2021, while the number of payrolled employees declined by an estimated 13,000 in July.
The softer labour data reduced pressure on the Bank of England to raise interest rates in the near term, limiting demand for Sterling. Markets are still pricing some additional BoE tightening by the end of the year, but the softer labour data reinforced expectations that policymakers can remain patient unless inflation pressures accelerate sharply.