Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast: UK Employment Hits Highest on Record at 73.2%
The Pound Sterling to Euro (GBP/EUR) exchange rate recorded market movement of +0.84 on Wednesday after the UK employment rate hit 73.2% – its highest level since records began.
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UK Jobless Claims Change showed a massive 38.6K jobseekers came off from benefits in January after finding employment. Meanwhile, Employment Change was up by 103K in the three months through December, allowing the Unemployment Rate to drop from 5.8% to 5.7%.
Wage growth including bonuses also accelerated from 1.8% to 2.1% in the final three months of 2014 on the year, which, combined with falling fuel prices, caused economists to suggest a rise in expendable income is on the way.
Economist James Knightly stated: ‘This indicated that we should be anticipating a big acceleration in real household disposable income in 2015 from 2014 levels. With consumer confidence already back at pre-recession highs this points to very decent consumer spending figures this year.’
However, excluding bonuses wage growth didn’t fare so well, falling from 1.8% to 1.7%; a figure that could perhaps be interpreted as a warning sign.
Industry expert John Philpot commented: ‘This suggests that the jobs-rich economic recovery is still failing to boost labour productivity, which does not bode well for long-term improvement in UK living standards even if very low price inflation is at present helping to raise real incomes.’
Meanwhile, Eurogroup negotiations came to a standstill earlier in the week and economists now suggest Greece will be asking for an austerity extension to buy time before signing up for a long-term deal.
Greek government spokesperson Gabriel Sakellaridis stated: ‘We believe the terms of the bailout cannot continue by any means. Let’s wait today for the request for an extension of the loan contract to submitted by Finance Minister Varoufakis. All along deliberations are going on to find common ground. We want to believe that we are on a good path. We are coming to the table to find a solution.’
Pound Sterling to Euro (GBP/EUR) Exchange Rate Forecast
Friday is forecast to be a busy day for the Pound Sterling to Euro (GBP/EUR) exchange rate when Markit publishes its German and Eurozone Manufacturing, Services and Composite Purchasing Managers Index (PMI). UK Retail Sales stats will also emerge on Friday.
The Pound Sterling to Euro (GBP/EUR) exchange rate is trading at 1.3572. The Euro to Pound Sterling (EUR/GBP) exchange rate is trending in the region of 0.7371.