020 7898 0500Sterling endured a roller-coaster ride yesterday with lots of news and data influencing the global market. In the morning, data relating to unemployment in UK had a major effect on the currency. Statistics showed that in the months of June through August, the number of unemployed people in the UK fell by 18,000 with the overall unemployment rate holding at 7.7%. Furthermore, data released showed that the number of people in the UK claiming unemployment related benefits had fallen by the most in 16 years over the last month helping strengthen the pound. The Bank of England has pledged not to raise interest rates until the overall unemployment rate drops below 7%, the strong figures released yesterday helped refuel the debate as to when that 7% level will be achieved and thus when interest rates would be hiked. This helped strengthen sterling against the majority of its counterparts until rumours of a deal over the budget in the US reversed these trends, furthermore, comments from the Bank of England’s chief economist quelled suggestions of an interest hike in the near term by pledging to keep interest rates until we saw a sustained economic recovery which did little to help sterling. Today, the major piece of data from the UK that could have a significant impact on the currency is the monthly retail sales figure. As always, positive results will reflect well on the country’s economy and current estimates are for growth of 0.5%. Call your trader now for the latest rates on the pound, as data continues its positive effects.
