euro-bank-notes - EUR
  • Pound (GBP) falls after mixed jobs data
  • UK unemployment unexpectedly rose to 3.9%
  • Euro (EUR) rose after Q1 GDP rose 0.1%
  • Eurozone CPI data is due

The Pound Euro (GBP/EUR) exchange rate is falling for a second straight day. The pair fell -0.23% yesterday, settling on Tuesday at €1.1491 and trading in a range between €1.1468 – €1.1524. At 05:35 UTC, GBP/EUR trades -0.07% at €1.1486.

The pound fell in the previous session after a mixed bag of UK labour market data. On the one hand, signs of cracks in the jobs market appeared, with unemployment unexpectedly ticking higher to 3.9% up from 3.8%. Vacancies slipped 4 the tenth straight month, and inactivity was also lower as more people returned to the labour force.

However, Wages also rose. Average earnings ticked up to 6.7% up from 6.6% but below the 6.8% forecast. The Bank of England will be watching this figure closely as it decides whether or not to raise interest rates in the June meeting.

There is no high-impacting UK economic data due today; instead, investors will be watching a speech by BoE Governor Andrew Bailey for his thoughts on whether the central bank is likely to hike rates again.

The euro pushed higher yesterday after GDP data confirmed the preliminary reading of nought .1% quarter on quarter in the first three months of the year. The data came after the EU Commission upwardly revised GDP growth for the eurozone region for 2023 two 1% up from nought .8% previously.

However, it wasn’t all good news. The German said EW economic sentiment index tumbled by more than expected to -10.7 in May from 4.1 in April. This was the first time that the index dropped into negative territory since December 2021.  The deep drop in investor sentiment raises the prospect of a recession in the eurozone’s largest economy.

Today attention remains on the economic calendar with the release of Eurozone inflation data, which is expected to confirm the preliminary reading of CPI rising to 7% annually, from 6.9%. Core inflation is expected to cool to 5.6% annually from 5.7%.