GBP saw a sign of relief in Tuesday’s morning session after the UK unemployment rate saw a decrease in June down to 4.2%. Even if there were signs of positive news, UK is still facing difficulties with the annual wage growth slowing down reaching 5.4% - the lowest it has been in two years.
Another factor the ONS (Office for National Statistics) reported were that they’re seeing a rise of people not actively searching for new job opportunities being too high. Overall, the market or GBP reacted positively to its latest job announcements seeing GBP/EUR breaking above the 1.17-mark and GBP/USD touching 1.28, and its likely that we will see initial resistance at these levels.
Next main event of data release for today is at 1.30pm, when the US will announce their PPI (producer price inflation). Market has become more data driven since both ECB and BoE lowered their interest rates and the Federal Reserve will be due next in September.
With the next step set in place for forecasting from the Federal Reserve, figures from inflation and job data have become more sensitive information for markets to digest. PPI is expected to decrease this afternoon to 0.1% from 0.2% back in June, potentially giving the Federal Reserve a relief of pressure ahead of their next interest rate cut and we could potentially see small USD gains if figures come out as expected.
