There has been more positive data from the UK this morning with the UK claimant count falling by 32,900 in March.
The forecast amongst experts was for a drop of just 7,500. The claimant count measure of unemployment for February was also revised. This showed 40,100 fewer people claiming, against an original reading of 32,500. Putting a slight dent on the figures, the overall rate of unemployment actually rose back to 8.0%, having held at 7.8% for the past three months.
The data has given sterling another boost this morning and it is currently trading around half cent up on the day against both the euro and the US dollar.
Duncan Higgins, senior analyst at Caxton FX comments, “Sterling is currently enjoying a positive run and the surprisingly steep fall in the number of Britons claiming benefit has further improved sentiment. Importantly, the figures raise expectations for a strong reading of economic growth in the first quarter, with all eyes on this data due Friday.”
“The employment data is important not only for the economy but also for its political ramifications. Recent polls have showed the Conservatives edging ahead once again, though this run of positive numbers from the UK could play into Labour’s hands,” continues Higgins
Duncan Higgins adds, “Should the data this week continue to point to an improving rate of recovery in the UK, we could see sterling near €1.16 and $1.55 by the week end.”
The minutes from the Bank of England latest policy meeting were also released this morning. As expected they revealed a unanimous decision among the members to keep policy unchanged. All members agreed that the events of the past month had not been sufficient enough to substantially alter their views of the medium-term outlook for inflation and activity.
