GBP/AUD is retreating on Friday after a bold three-day rally that started Tuesday. The pair is now trading at 1.9236, down 0.05% as of 6:00 AM UTC. Nevertheless, the price has gained over 0.70% for the week.
While there are no major fundamentals to drive the markets, the pound is taking some rest after a report prepared by accounting firm KPMG and the Recruitment and Employment Confederation (REC) showed that British employers’ demand for workers increased last month at the slowest pace in over a decade.
The index of demand for staff fell to 51.4 in November, from 51.6 in October, the lowest level since September 2009. The performance adds more pressure to the UK’s labor market ahead of the general election scheduled for December 12.
It’s worth mentioning that the index is monitored by the Bank of England (BoE). Interestingly, during the central bank’s Monetary Policy Committee meeting in November, two out of nine members surprisingly voted to cut interest rates, citing signs of weakness in the labor market.
KPMG vice chair James Stewart commented:
“The uncertainty around the upcoming election and Brexit outcomes are playing havoc with the UK jobs market, as clearly employers and job-seekers are taking a wait-and-see approach before committing to growth or movement.”
The indicator showed that addition of permanent jobs declined for a ninth month in a row, corresponding to official data that has shown a decrease in job creation.
Also, the KPMG/REC’s survey showed that wages for permanent staff increased last month at the slowest pace since December 2016, while salaries for temporary staff showed the weakest gain since November 2016. The BoE warned that salary growth in the UK would likely wane in the coming year, after reaching the highest level in a decade.
As for the Aussie, it looks stronger today as analysts increased their forecasts for the currency as it proves resistant against global trade uncertainty and negative news at home.
Currently, the US and China are still negotiating a potential phase one trade agreement, though Beijing insisted that Trump had to rollback some tariffs.