Forex News – Sterling falls on rise in UK unemployment

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Forex News – Sterling trades steady after reaching 3 week lowSterling fell across the board this morning after UK employment data showed the number of people claiming unemployment benefits rose at its fastest pace in almost two years in the month of May from a revised 16,900 to 19,600 claimants. Economist had forecast 7,000 claimants.

The unemployment rate for the 3 months to April 2011 was 7.7 % of the economically active British population, which was down 0.3% on the quarter. The total number of unemployed Britons dropped by 88, 000 over the quarter to reach 2.43 million jobless. This is the largest quarterly fall in unemployment since the three months to August 2000.

 

Sterling fell almost 80 pips against the dollar to a session low of 1.6312 an hour after the data was released and is still falling.

The Euro rose around 30 pips against the Pound to 0.8805 but soon fell again.

Meanwhile, September gilt futures pared losses to stand 18 ticks lower on the day at 120.43, having been 25 ticks lower before the data.