- Pound (GBP) rises ahead of jobs data
- UK labour market data in focus
- Euro (EUR) under pressure after gains on Monday
- German ZEW sentiment data due
The Pound Euro (GBP/EUR) exchange rate is edging higher on Tuesday after losses in the previous session. The pair fell 0.2% on Monday, settling at €1.1958, towards the low of the day. At 05:45 UTC, GBP/EUR trades +0.07% at €1.1966.
The Pound drifted lower in the previous session in subdued trade despite encouraging news surrounding falling COVID numbers and a rise in shopper numbers. The number of shoppers rose 1.5% in the week ending 15th January compared to the previous week thanks to more people hitting the high street. The data suggests that employers could slowly be returning to the office, even though the government’s work from home guidance remains.
Separately, Prime Minister Boris Johnson is still clinging onto power amid the ongoing partygate enquiry.
Today attention swings back towards the UK economic calendar with the release of UK unemployment data. Back in October the number of employees on payrolls rose by 257,000 to 29.4. and unemployment ticked lower to 4.2%. According to the Office of National Statistics UK unemployment is expected to have fallen to 4.1% in the three months to November. So far the UK labour market has managed to absorb those coming off the governments furlough scheme, calming concerns at the Bank of England.
The Euro edged a few pips higher on Monday in a dull session, with the common currency failing to attract swathes of buyers. The US being closed to Martin Luther King Day, combined with a quiet economic calendar resulted in subdued start to the week.
Italian inflation data was the only macro release of interest and came in at 3.9% year on year, in line with expectations.
Today attention is on the ZEW German Economic Sentiment survey. Current conditions are expected to remain stable at -7.5 in January, down slightly from 7.4. Meanwhile economic sentiment is expected to improve, rising to 32.7, up from 29.9.
Meanwhile the Eurozone ZEW sentiment survey is expected to deteriorate slightly to 26.4.