020 7898 0500The unemployment rate released was 4.9%, down from the 5.5% a year ago, with little change from the previous month. Much to economists’ surprise employment has remained resilient after the EU Referendum result, despite many doomsday predictions. However, these are still early days and the real impact is likely to be seen during the next two quarters. Sterling did not benefit for too long from the positive data, approaching at one stage weekly lows against both the US dollar and the euro, as the markets remain cautious ahead of today’s Bank of England (BoE) interest rate, bank rate votes and monetary policy report.
The markets are braced for a dovish tone when the BoE minutes are realised this morning, but any unexpected positivity should help sterling to rally. Prior to the BoE decision, we will see retails sales figures released at 9.30am – if these are as encouraging as last month’s figures, they may help to create a bit of momentum for a sterling rally, especially if the BoE can surprise us to the upside.
