Talking Points:
• UK Jobless Claims Fell More than Estimated in October
• British Pound Appreciated vs. US Dollar After Jobs Data
• Currency Markets Now Focused on the BOE Inflation Report
UK Jobless Claims fell more than expected in October, down 41,700 vs. economists’ estimates calling for a 30,000 drop. September’s reading was revised higher to show a drop to 44,700 from -41,700.
The British Pound briefly jumped higher against the US Dollar following the positive release but the move was short lived as the data has limited effects on near term monetary policy. Likewise, the unemployment rate for the three months to September was 7.6 percent, still higher than the 7.0 percent BoE’s threshold that could mean a shift on the current benchmark interest rate level of 0.50 percent.
Perhaps the most important release the market is expecting is the October Quarterly Inflation report due today at 10:30 GMT. Traders will look to the document to gauge policymakers’ assessment on growth and inflation projections. This will help establish the likely time frame within which the Bank expects to meet its guidance objectives and begins to withdraw policy support.
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GBPUSD 5 Min: Nov 13, 2013
Chart created byCecilia Sanchez-Corona usingMarketscope 2.0
-- Written by Cecilia Sanchez-Corona, DailyFX Research. Feedback can be sent to instructor@dailyfx.com
