GBP price, news and analysis:
- GBP / USD is gaining ground following the UK ‘s strong labor market performance, which has refocused on the Bank of England’ s policy makers and whether some are convinced that the UK ‘s monetary policy should be tightened sooner than previously expected.
- Job vacancies rose to over a million for the first time as records began to hit as the UK economy recovered from the Covid-19 pandemic, while wage bills rose more than economists had predicted.
GBP / USD strengthening for the second day in a row
GBP/USD continues to make progress on Tuesday after data from the UK labor market, which showed tnumber of vacancies in the three months to Augustfor the first time since the start of the recordings, a lower unemployment rate and another rise in the August wage bill.
Economic data for the United Kingdom
Source: DailyFX economic calendar
By the margin, the numbers could convince the couriers of the Bank of England’s Monetary Policy Committee that monetary policy needs to be tightened sooner than they expected. Note, however, that market pricing does not expect UK interest rates to rise until March 2022, and another in September 2022.
It is likely that the labor market benefited in August from the return of many UK workers to the office, and perhaps also from the news that the UK is preparing to distribute Covid-19 amplification techniques. All this is positive for GBP / USD, although caution is needed on Wednesday’s UK inflation data, which is projected to rise to 2.9% per annum in August, from 1.8% in July.
GBP / USD price chart, one hour schedule (September 3 – 14, 2021)
Source: IG (click for larger image)
– Written by Martin Essex, analyst
Feel free to contact me on Twitter @MartinSEssex