Breaking News
Get 40% Off 0
Is NVDA a 🟢 buy or 🔴 sell? Unlock Now

Pound to Dollar Rate Falls On Strong Labour Market Reading

Published Dec 08, 2023 13:53 Updated Dec 08, 2023 14:12
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
Pound to Dollar Rate Falls On Strong Labour Market Reading
 
GBP/USD
+0.09%
Add to/Remove from a Portfolio
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

PoundSterlingLIVE - Another above-consensus U.S. labour market report has propelled the Dollar higher into the weekend.

The Pound to Dollar exchange rate fell by two-thirds of a per cent in the minutes following news the U.S. added 199K non-farm jobs in November, exceeding the market's expectation for 180K and representing a noticeable pickup on October's 150K.

The Dollar was bid as market-implied expectations for the first U.S. Federal Reserve rate cut of 2024 receded, thereby supporting bond yields.

The unemployment rate fell to 3.7% from 3.9%, defying expectations for an unchanged figure.

"Today’s November jobs report showed there is still some sizzle left in the labour market with wage growth accelerating and the unemployment rate edging down," says Ali Jaffery, an economist at CIBC.

For the Fed to consider cutting interest rates in the coming months policymakers will likely require the unemployment rate to be heading higher, as this implies a loosening in labour market conditions.

But the jobs market is tight, with wages also surprising: average hourly earnings rose 0.4% month-on-month in November, exceeding the estimated 0.3% and accelerating on October's 0.2%.

The Fed will be concerned that the labour market is tight enough to keep pay rates elevated, ensuring inflation remains above the 2.0% target for an extended period.

The data will underscore the Fed's message that interest rates must stay higher for longer, which ultimately supports U.S. yields and the Dollar.

"Today’s report will certainly raise some eyebrows in the FOMC and is a reminder that the labour market remains tight. But with inflation persistence less of a challenge, the Fed will continue to remain patient," says Jaffery.

The data is not enough to signal any major shift that should be expected from the Fed, but it is enough to confirm the recent Pound-Dollar uptrend is over, at least for now.

An original version of this article can be viewed at Pound Sterling Live

Pound to Dollar Rate Falls On Strong Labour Market Reading
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Chris Chadwick
Chris Chadwick Dec 08, 2023 15:09
Saved. See Saved Items.
This comment has already been saved in your Saved Items
The NFP snake oil barrel is bottomless it seems..
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email