GBP/CAD is declining on Tuesday, after gaining 1.40% yesterday.
Currently, GBP/CAD is trading at 1.7075, down 0.68% as of 10:18 AM UTC. The price hit a daily low at 1.7034.
The pair is pointing downwards as oil prices move sideways while the UK is hit by coronavirus pessimism. The pound also reacted on fresh labor market data and government’s announcement that it would support businesses amid the coronavirus outbreak.
UK Created More Jobs Than Expected, But Unemployment Surged Too
The Office for National Statistics said that Britain beat expectations and created more jobs in the three months to January. Nevertheless, unemployment increased as well.
The number of employed people rose by 184,000 to 32.985 million, the ONS stated, driven by record quarterly surges in full-time and female employment. Analysts polled by Reuters expected an increase by 143,000.
However, unemployment increased by 63,000 during the same period, which is the biggest increase since 2011.
ONS statistician David Freeman commented:
“Today’s figures show continuing record employment but also a slight rise in unemployment on the year… This is because we also see a record low rate for people neither working nor looking for work.”
ONS data showed that wages continue their growth. Growth in total earnings, including bonuses, increased by an annual 3.1% in the three months to January, from 2.9% in the three months to December. Without bonuses, the indicator slowed to 3.1% from 3.2%. Analysts expected total earnings to increase by 3.0% and regular pay to stay flat.
Recent data proves that UK Prime Minister Boris Johnson’s victory in the December election boosted sentiment, but the coronavirus outbreak bedevil the economy.
Last week, the Bank of England cut the interest rate to 0.25% from 0.75% and launched emergency credit measures to help businesses avoid bankruptcies.
UK Government to Unveil More Support for Businesses
Today, the British governments should reveal further stimulus for domestic businesses hit by the coronavirus outbreak, as people were previously told to avoid restaurants, clubs, pubs, theaters, and cinemas.
Finance minister Rishi Sunak is about to announce the new measures at a daily government news conference.
Adam Marshall, director general of the British Chambers of Commerce (BCC), believes that the government should expand support to fight the coronavirus crisis. He told BBC:
“Government has got to do more on the upfront costs facing businesses. Banks have got to do more to get support to the front line. And also I think the UK has to do more to coordinate a global economic response.”
