UK unemployment rate unexpectedly fell to 4.7% in June

• The number of UK applicants rose to -7.8000 in July.
• The UK unemployment rate fell to 4.7% in June.
• UK wages excluding bonuses rose 7.4% year over year. 7.4% expected.

The Office for National Statistics (ONS) showed on Tuesday that the UK’s official unemployment rate positively surprised markets, rising by 4.7% year-on-year in June. Previous forecasts were 4.8% and 4.8% expected, while the number of applicants fell slightly in the last month.

The number of people claiming unemployment benefits fell by 7.8000 in July, compared to -114.8000 recorded earlier. The share of applicants was 5.7% compared to 5.7% in the previous month.

UK average weekly earnings excluding bonuses was 7.4% (3Mo/JoY) in June compared to +6.6% in the previous month and +7.4% expected, while value including bonuses in June was 8.8% (3Mo/JoY) It was +7.3% in the previous month and +8.7% expected.

POIs (via ONS)

The number of job vacancies in the UK rose to over one million for the first time in July.

UK production per hour worked in the second quarter was 0.6% above pre-pandemic levels.

UK second-quarter production per hour worked -0.5% q/q.

GBP/USD reaction

The GBP/USD pair stopped rising above 1.3800 despite the positive UK employment report.

It was most recently traded at 1.3820, with a 0.21% daily loss as focus shifted to US retail sales and Fed Chair Powell’s speech.

About UK Jobs

UK median income, published by the Office for National Statistics (ONS), is a leading short-term indicator of how wage levels are performing in the UK economy. In general, positive income growth is considered positive (or bullish) for the British pound, while depreciation is considered negative (or bearish).