Sterling dropped 0.6% against the dollar and 0.4% against the euro as the session got underway; though that leaves most of the currency’s post-May Brexit speech gains intact it does suggest that investors aren’t too keen to send it above $1.24 and €1.16 respectively. As for the FTSE, sterling’s early shyness only helped it post a meagre 5 point rise, meaning the index is still more than 100 points from the highs it hit at the start of the week.
The focus this morning is likely to remain on the pound as it processes the UK jobs data. For the 3 months to the end of November wage growth is expected to creep up to a fresh 1 year-plus high, with the unemployment rate forecast to come in unchanged at 4.8%. The claimant count change reading for December, meanwhile, is set to rise to 4.6k from 2.4k, though with some chunky revisions likely to be made to that latter number. If accurate these figures probably aren’t enough to inspire another round of remarkable growth for the pound, though it could ease its current losses.
Elsewhere the Eurozone indices weren’t up to much; the DAX sat flat at 11550, while the CAC slipped back by 20 points. Whether this stays the same will be dependent on the Eurozone-wide inflation figure later in the morning – analysts expecting confirmation of December’s previously stated 1.1%, a marked increase on November’s 0.6%.
