The GBP EUR exchange rate moved higher again on Monday by 0.25% as the pair capitalises on last week’s ECB-inspired rally. The UK will lead the week on economic data with the release of the latest employment figures into June. The market is looking for a strong 178k number after last month’s 95k and these reports are taking into account the economic reopening.
The GBP to EUR trades at 1.1730 and will try to push ahead to the 1.1800 levels again if the data supports.
UK employment figures released today
The employment figures will be released for the UK economy today with markets looking for 178k jobs created.
Unemployment in the UK has improved over the last few months, and this has been highlighted with a sharp drop in the claimant count since March, when it was 7.2%. That figure has since dropped to 5.7% in July, as businesses continue to reopen.
The unemployment rate saw to 4.7% in the last reading, but the furlough scheme is still hiding some of the larger damage. The rate is expected to fall further to 4.6% for the three months to July, while wage growth has also been on the rise due to staff shortages and inflation.
The ending of the furlough scheme at the end of September could be a headwind for the UK jobs market, alongside the recent increase in the National Insurance rate. Business groups were critical of the government’s tax hike at a time when businesses have been enough pressure.
The CBI’s president said: “After all that business has gone through during the pandemic and the fantastic Government support that followed, now is not the time for tax increases. It’s time to stimulate investment and growth in the economy.”
Fears over a third wave but Johnson ‘dead set’ against lockdowns
Prof Neil Ferguson has said that the UK must boost its immunity by vaccinating more teens in order to stop the risk of “a large autumn and winter wave”.
His prediction came as the Telegraph said Boris Johnson was ‘dead set’ against any future lockdowns.
But the PM refused to be drawn on whether winter lockdowns would be used with his official spokesperson saying:
“We are in a very different place than where we were previously when other lockdowns were introduced, thanks to the success of our vaccine programme and other things like therapeutics treatments for coronavirus”.
“We would only ever consider those sort of measures as a last resort and we will set out in more detail tomorrow what our approach will be should we see a significant increase in cases.”
The pound versus the euro exchange rate has been weaker as the UK saw a large number of cases despite one of the highest vaccination rates in the world. With the economic recovery bounce starting to fade, a lot could depend on the autumn and winter case numbers. The UK will release the latest inflation numbers tomorrow after today’s employment figures.