UK Unemployment Claims Fall, Sterling Advances

The Great Britain pound advanced today as the number of Britons seeking unemployment benefits was smaller than analysts have previously estimated, giving evidence that the UK economy is recovering.

The number of people claiming Job Seeker’s Allowance fell by 8,600 in May from the prior month, while market participants have anticipated a drop by 6,800. Moreover, the April’s decline was revised from 7,300 to 11,800. As there are less people looking for job there are fewer chances that the Bank of England will have to stimulate the economy again. Such outlook was positive for the sterling.

GBP/USD advanced from 1.5641 to 1.5659 as of 10:35 GMT today, trading near the highest level since February. GBP/JPY rose from 150.18 to 151.14 and its daily high was at 152.00.

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