When are the UK jobs and how could they affect GBP/USD?

UK Jobs report overview

The UK labor market report is expected to show that the average weekly earnings, including bonuses, in the three months to May, are expected to accelerate by 3.1%, while ex-bonuses, the wages are expected to rise by 3.5% in the reported period.

The number of people seeking jobless benefits is likely to have increased by 18.9k in June. The ILO unemployment rate is expected to hold steady at 3.8% during the period.

“The UK economy has run at a slower pace in the past 18 months but it does not appear to be edging towards recession. The risk to the employment figures for May and June partake of this weaker direction though there is as yet no sense of a strong downtrend.,” Joseph Trevisani, Senior Analyst at FXStreet explains.

How could they affect GBP/USD?

A negative surprise in the UK’s wage growth numbers could accentuate the latest leg down in the pound. The Cable could test the six-month lows of 1.2440. A break below the last, exposes the 1.2400 psychological level.

On upbeat readings, the GBP/USD pair could bounce-back for a re-test of the 5-day MA at 1.2536, above which the immediate resistances lie at 1.2576/89 (Jul 15 high/ 20-DMA) and 1.2600 (daily classic R2).

Key Notes

UK: Unemployment rate likely to remain unchanged at 3.8% in May - TDS

GBP/USD forecast: Struggles near 1.2500 handle ahead of UK jobs data, Carney’s speech

GBP Futures: further rangebound likely

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).