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 March, are expected to decelerate slightly by 3.4%, while ex-bonuses, the wages are expected to rise 3.3% in the reported period.

The number of people seeking jobless benefits is seen increasing by 24.2k in the three months to April versus 28.3k additions booked last. The ILO unemployment rate is expected to hold steady at 3.9% during the period.

How could they affect GBP/USD?

A bigger-than-expected drop in the UK’s wage growth numbers could trigger a fresh round of selling in the pound. The rates could test the 1.2900 (round figure). A break below the last, a test of 1.2884 (classic daily S2, Fib S3) remains inevitable.

On a positive surprise in the readings, the GBP/USD pair could bounce-back for a re-test of the 200-day MA at 1.2965, above which the immediate resistances lie at 1.2986 (5-day MA) and 1.3003 (20-day MA).

“The wage data, which tends to have the most substantial impact on the pound, may surprise to the upside and boost Sterling. The downside surprise comes from the unemployment rate. A rate of 3.9% is extremely low and may not hold for a long time. An increase may also stem from the ongoing rise in the claimant count change, or jobless claims,” Yohay Elam, Senior Analyst at FXStreet explains.

Key Notes

UK: Labour market to remain very tight - TDS

GBP/USD analysis: Hovers around the very important 200-DMA ahead of UK jobs data

GBP/USD faces an uphill battle to recover — Confluence Detector

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).