Pound Rises After U.K. Employment Data

(RTTNews) - The British pound strengthened against other major currencies in the pre-European session on Tuesday, following the release of U.K. employment report.

Data from the Office for National Statistics showed that the U.K. unemployment rate unexpectedly held steady in the three months to May. The jobless rate stood at 4.9 percent in the March to May period, the same as in the February to April period. The rate was expected to rise to 5.0 percent.

In the corresponding period last year, the rate was 4.7 percent.

The number of unemployed people totaled 1.760 million, decreased by 17,000 compared to the preceding three-month period. Meanwhile, the employment level was 34.475 million versus 34.327 million in the previous period.

Data also showed that the annual growth in employees' average earnings, excluding bonuses, remained stable at 3.4 percent in the March to May period. Including bonuses, the earnings growth eased slightly to 4.3 percent from 4.4 percent.

European stocks eked out modest gains in cautious trade as oil prices eased amid diplomatic efforts to ease the U.S.-Iran conflict and investors awaited quarterly results from U.S. tech giants for fresh insights into the durability of artificial intelligence-driven demand.

On Wednesday, traders will look to the U.K. CPI inflation report for additional indications. It is anticipated that the core CPI will increase by 2.5 percent in June, while the headline CPI will rise by 2.7 percent year over year.

Andy Burnham, the newly appointed prime minister of the United Kingdom, stated that he would not be "taking risks with the economy" and pledged to adhere to budgetary regulations. John Healey, a former defense secretary, was appointed Chancellor of the Exchequer by Burnham.

In the European trading today, the pound rose to 0.8491 against the euro and 1.0893 against the Swiss franc, from early lows of 0.8501 and 1.0879, respectively. If the pound extends its uptrend, it is likely to find resistance around 0.83 against the euro and 1.09 against the franc.

Against the U.S. dollar and the yen, the pound advanced to 1.3451 and 218.61 from early lows of 1.3427 and 218.20, respectively. The pound may test resistance around 1.36 against the greenback and 220.00 against the yen.

Looking ahead, U.S. ADP weekly employment data and U.S. Redbook report are slated for release in the New York session.