GBP/USD TUMBLES LOWER AS LOSSES ACCELERATE
- GBP/USD shed nearly a full percent on Tuesday.
- Markets are pulling back into the Greenback meaningfully.
- UK Unemployment Rate rose appreciably in September.
GBP/USD lost its footing on Tuesday, shedding almost a full percent after UK labor figures came in mixed, but all Cable traders could focus on was a steeper-than-expected upswing in the UK Unemployment Rate. Outside of the UK, a broad-market bullish recovery in Greenback flows is keeping the USD well-bid, exacerbating intraday losses for Cable.
UK labor figures mostly exceeded expectations, but wages growth keeps inflation concerns elevated. While unemployment claims were below forecasts, jobless benefits seeker counts still rose compared to the previous month’s revised figure.
The Bank of England’s (BoE) latest Monetary Policy Report is due early Wednesday, and investors will be looking out for hints of how the BoE plans to deal with a lopsided UK economy that continues to grapple with inflation figures. On the US side, key Consumer Price Index (CPI) inflation figures will land on markets. Full-fat CPI inflation is forecast to tick higher to 2.6% YoY compared to September’s print of 2.4%. Core CPI inflation is expected to hold steady at 3.3% YoY. The monthly figure for both inflation categories are broadly expected to hold flat month-on-month.
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