Forex News: Pound Rises As U.K. Unemployment Rate Falls

Pound Rises As U.K. Unemployment Rate Falls

(RTTNews) - The British pound strengthened against other major currencies in the European session on Tuesday, after the U.K. unemployment rate declined in the three months to August.

Data from the Office for National Statistics showed that the ILO unemployment rate stood at 4.7 percent in the June to August period compared to 4.9 percent in the preceding period.

Economists had forecast the rate to remain unchanged at 4.9 percent.

In the three months to August, average earnings including bonus grew 3.7 percent from a year ago, weaker than forecast of 3.8 percent. This followed a 3.9 percent increase in the previous period.

Average earnings excluding bonus also increased 3.7 percent, which was slightly bigger than forecast of 3.6 percent.

Further, data showed that payroll employees for September increased by 13,000 from the last month to 30.3 million.

The ONS said vacancies decreased 21,000 to 691,000 during July to September compared with April to June. This was the largest quarterly fall since January to March 2026.

Investors await the release of the U.K. Consumer Price Index (CPI) data for September due to be published on Wednesday.

Meanwhile, European stocks traded lower due to Houthi attacks on Saudi Arabia infrastructure and reports of vessel attacks in the Gulf.

Widespread protests and unrest in countries like France and Italy driven by rising fuel costs, reduced public services and housing issues also prompted investors to adopt a more cautious stance.

In the European trading today, the pound rose to nearly a 1-1/2-year high of 0.8400 against the euro and a 6-day high of 1.1027 against the Swiss franc, from early lows of 0.8427 and 1.0991, respectively. If the pound extends its uptrend, it is likely to find resistance around 0.83 against the euro and 1.11 against the franc.

Against the U.S. dollar and the yen, the pound advanced to a 4-day high of 1.3359 and a 1-month high of 211.25 from early lows of 1.3309 and 210.78, respectively. The pound is likely to find resistance around 1.35 against the greenback and 214.00 against the yen.

Looking ahead, U.S. ADP employment data, U.S. building permits, housing starts and pending home sales, all for September, are slated for release in the New York session.

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