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 number of people seeking jobless benefits increased by 3.2k in the three months to November, compared to an increase of 1.1k booked in the three months to Oct.

The unemployment rate is expected to drop to hit a fresh multi-decade low of 4.2% during the period. Average weekly earnings, including bonuses, in the three months to Oct are expected to arrive firmer at 2.5%, while ex-bonuses, the wages are seen unchanged at 2.2% in the reported month.

Deviation impact on GBP/USD

 Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined between 20 and 60 pips in deviations up to 2 to -4, although in some cases, if notable enough, a deviation can fuel movements of up to 85 pips.

How could affect GBP/USD?

A positive surprise in the claimant count combined with higher average earnings could lift Cable back above the 1.3350 barrier. On a disappointing result, we could see the GBP/USD pair stall its recovery mode and drop back to test 1.3300 mark.

Haresh Menghani, Analyst at FXStreet, notes, “Technically, the pair has been printing lower highs/lower lows since the beginning of this month and hence, a clear break through the 1.3300 handle would suggest an extension of the near-term downward trajectory towards 50-day SMA support near the 1.3250-45 region. A follow-through selling pressure has the potential to continue dragging the pair further towards a medium-term bullish trend support around 100-day SMA support, currently near the 1.3190 region.” 

“Meanwhile, on the upside, momentum beyond 1.3340-50 zone could assist the pair back towards 1.3380-85 horizontal resistance ahead of the 1.3400 handle. A convincing move beyond the mentioned hurdles would negate any near-term bearish bias and help the pair to resume with its prior bullish momentum”, Haresh adds.

Key notes

UK unemployment rate likely to fall to yet another multi-decade low of 4.2% - TDS

UK Employment Preview: Impact of unemployment rate falling to multi-decade low is limited in the UK

About UK jobs

The Claimant Change released by the Office for National Statistics (ONS) presents the number of unemployment people in the UK. There is a tendency to influence the GBP volatility. Generally speaking, a rise in this indicator has negative implications for consumer spending which discourage economic growth. Generally, a high reading is seen as negative (or bearish) for the GBP, while a low reading is seen as positive (or bullish).