When are the UK jobs and how could they affect GBP/USD?

UK Jobs report overview

Early Tuesday, the UK’s Office for National Statistics (ONS) will release the February month Claimant Count figures together with the Unemployment Rate in the three months to November January at 07:00 AM GMT. Although the UK’s unlock announcement, unveiled recently, keeps GBP/USD traders hopeful, fears of reflation need a tough fight from the key jobs report to recall the cable buyers.

The UK labor market report is expected to show that the average weekly earnings, including bonuses, in the three months to January, grew from the previous 4.7% to 4.9%, while ex-bonuses, the wages are seen improving from 4.1% to 4.4% during the stated period.

Further, the ILO Unemployment Rate challenges upbeat signals of the employment data as forecasts suggest an uptick to 5.2% from 5.1% during the three months ending in February. Also on the same line could be the Claimant Count Change figures that dropped to -20K during the latest release.

Deviation impact on GBP/USD

Readers can find FX Street's proprietary deviation impact map of the event below. As observed the reaction is likely to remain confined around 20-pips in deviations up to + or -2, although in some cases, if notable enough, a deviation can fuel movements over 60-70 pips.

How could they affect GBP/USD?

GBP/USD drops towards 1.3800, currently down 0.22% intraday around 1.3825, while declining for the fourth consecutive day ahead of data, namely Tuesday’s London open. Although the EU-UK jitters over the coronavirus vaccine are largely to blame for the cable’s latest weakness, traders fear further challenges to the UK’s unlock measures and hence today’s data will be the key to watch.

BOE Governor Andrew Bailey hopes for Britain’s faster economic recovery but his teammates are divided and hence any disappointment in today’s employment could spread economic fears and weigh on the GBP/USD prices. It should be noted that the UK debt is already at a multi-year high, 95% of GDP, which in turn challenges further easy money policies and the same came probe sterling optimism even if the BOE stays ready to propel the markets if needed.

Technically, GBP/USD inches closer to the key 1.3830-25 support convergence, including 50-day SMA and an ascending trend line from March 05. However, a clear downside past-1.3825 will direct the quote towards an upward sloping support line from January 11, currently around 1.3770. Meanwhile, the corrective pullback can eye the 1.3900 round-figure before confronting a short-term falling trend line resistance at 1.3955.

Key notes

GBP/USD Price Analysis: Remains offered around 1.3850 ahead of UK jobs, BOE’s Bailey

GBP/USD subdued in mid-1.3800s ahead of busy slate of UK & US events

GBP/USD Outlook: Sustained break below 1.3800 mark awaited for bearish confirmation

About UK jobs

The UK Average Earnings released by the Office for National Statistics (ONS) is a key short-term indicator of how levels of pay are changing within the UK economy. Generally speaking, the positive earnings growth anticipates positive (or bullish) for the GBP, whereas a low reading is seen as negative (or bearish).