The Sterling pound today rallied higher against the US dollar following the release of upbeat UK wages data in the early European session. The pound was also boosted by investor hopes of another Brexit referendum after the Labour Party introduced a motion to back the same in Parliament.
The GBP/USD currency pair today rallied from a low of 1.2855 to a high of 1.2927 after the positive wages report.
The currency pair’s latest rally was driven by the upbeat UK labour market report for January whose prints beat expectations. According to the Office for National Statistics, average weekly earnings met expectations by coming in at 3.3% in the three months to November. Furthermore, weekly earnings including bonuses beat expectations by coming in at 3.4% versus the expected 3.3% print. The ILO unemployment rate came in at 4.0% showing a 0.1% drop, while the change in jobless claims was slightly higher than expected. The pair was also boosted by positive Brexit developments, which had investors hoping for a second Brexit referendum that would keep the UK in the EU.
Investors are hoping that Theresa May‘s Plan B would have room for changes that include delaying Article 50, a permanent customs union, or the elimination of the no deal option. The pair was also affected by the strong US dollar, which was boosted by investor fears of a global economic slowdown.
The cable’s short-term performance will continue to be influenced by Brexit developments and investor sentiment towards the UK.
The GBP/USD currency pair was trading at 1.2895 as at 11:52 GMT having dropped from a high of 1.2927. The GBP/JPY currency pair was trading at 141.07 having dropped from a high of 141.54.
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