Labour data boosts the Pound

Yesterday’s markets

20th October 2016

  • GBP Average Earnings Index 3m/y: 2.3%
  • GBP Unemployment Rate: 4.9%
  • GBP Claimant Count Change: 0.7K
  • CAD BOC Rate Statement: 
  • AUD Employment Change: -9.8K
  • AUD Unemployment Rate: 5.6%

This week, the UK data continued to dominate the headlines as we gained a raft of high tier Labour data yesterday morning. UK unemployment remained sticky at 4.9%, an 11 year low. Average earnings also remained healthy at 2.3%, whilst the claimant count change exceeded economists’ consensus, registering a 0.7k. The Pound rallied after the release, ticking above a key psychological level. However, the healthy data has done little to mitigate the collapse in the currency since the Brexit vote.

Across the pond, Democratic presidential nominee, Hillary Clinton has a nine-point lead over Republican Donald Trump in the latest Bloomberg Politics national poll. With fresh scandals against Trump coming to the forefront it looks all but certain that Clinton will win the election. Yesterday, bookmaker Paddy Power paid out more than $1 Million on bets that Clinton would win the race to the White House, signifying that some are calling the race over. 

Today’s markets

19th October 2016

  • GBP Retail Sales m/m
  • GRP MPC Member Shafik Speak
  • EUR ECB Press Conference
  • EUR Minimum Bid Rate
  • USD Unemployment Claims
  • USD Philly Fed Manufacturing Index

The main event will be the European Central Banks rate decision followed by the press conference led by Mario Draghi, head of the ECB. Although no changes are expected to the current rate or QE programme, investors will be watching comments made by Draghi, specifically for any mention of Brexit and article 50 being triggered next year. With the demise of Sterling already seen, experts will look to see how Mario Draghi will respond to what or how this may affect the Eurozone. Meanwhile, consumer spending in the UK is forecasted to increase for September as retail sales is due to increase to 0.3%.