The quid has dropped after the UK public spending and jobs data

Let’s review the numbers

  • The claimant count dropped – positive
  • Unemployment rate rose – negative
  • Rise in unemployment (46k) the highest since Feb 2013 – negative
  • Employment change UP but less than expected – very mildly negative
  • Wages held up – positive
  • Ex-bonus wages rose – positive
  • Vacancies up 24k to a new record of 823k – positive (more vacancies going unfilled leads to a tighter jobs market and wage rises)
  • Bigger drop in borrowing numbers than expected – positive

I’m sitting here struggling to find a reason why the quid has dropped when you put it all together but drop is has, and to a low of 1.3928 (although it’s bouncing as I type back to 1.3964).

The seasonal skew was very evident and it’s probably that reason why it’s been a bit messy. I’d have been a buyer at 1.3900 on the data but otherwise, if I don’t understand the reasons for a certain move, I won’t touch it.

Ryan Littlestone
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