Despite the ongoing chaos and uncertainty around Brexit, UK labour market conditions remained firm.
The latest data, covering the three months to December 2018, showed that the number of people in employment surged by 167k from the prior quarterly reading. This was well above expectations of a 153k rise. Furthermore, employment was a whopping 444k higher than that of the same time last year.
While the claimant count did tick slightly higher to 14.2, above the expected 12.3k rise, the unemployment rate remained steady at lows of 4%. Indeed, the number of unemployed people, at 1.36 million, was 14k lower than the prior quarterly reading. It was also 100k lower than the recorded number at the same time a year earlier.
Wage Growth Stalling
However, wage growth did show a loss of momentum. It remained unchanged at 3.4%, coming in under the expected 3.5% reading. The news is still good for UK consumers though, as wages remain comfortably higher than inflation.
In all, the data was positive and will be encouraging for the BOE. The central bank expressed its desire to continue to raise rates, provided that a Brexit deal can be achieved to avoid any adverse economic shocks. So, for now, all eyes remain on Brexit negotiations.
After trading down to retest the broken falling wedge pattern and piercing back below the upper trend line, GBPUSD has since turned higher again. It is now holding back above the pattern. Bulls will need to see a break back above the 1.3004 resistance to encourage further upside, while for now, focus remains on a test of deeper support at the 1.2693.