Pound Falls vs. Euro After Jobless Report

The Great Britain pound fell against the euro, while being moderately up against the other major currencies, after the release of the BoE’s minutes and the jobless claims report in the United Kingdom today.

As the released minutes of the Bank of England last meeting showed, the interest rate was left unchanged at 5 percent because the inflation risk still weighted over the recession factors. But according those minutes, inflation may soon reach its peak, after which a rate reduction series may come.

The unemployment claims in U.K. rose unexpectedly to 32,500 in August. This signal can be easily interpreted by the pound currency traders as bearish. If only the next CPI report comes out below the expectation level, interest rate will most likely be lowered during the next monetary policy meeting.

EUR/GBP rose significantly today on the wave of the euro’s upward correction — it went up from 0.7920 to 0.7964 as of 9:09 GMT. GBP/USD rose slightly today — from 1.7807 to 1.7852; GBP/JPY showed a high spike with a daily maximum at 190.85, but then rectraced significantly and is now trading at 188.23 — above the 187.91 open level.

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