UK unemployment rate ticks higher

There were 177,000 fewer people in employment in the first three months of the year, bringing the unemployment rate up to 4.3%.?This?is the third negative set of data in a row and the third rise in the unemployment rate this year. As with all UK data?at the moment, investors and traders will be looking at this through the prism of whether it impacts the Bank of?England's?interest rate-setting decisions. The BOE have already suggested they will start cutting interest rates in June?but?they have been quite cagey about the pace of those cuts. Worsening unemployment may bring on larger or perhaps faster interest rate cuts to try and combat the slowdown in the economy.?These employment figures?were widely expected?by the markets, which explains why the pound has been largely unaffected by the news.?The GBP/USD rate is static around $1.2560?but?the GBP/EUR rate is back up to where it was seven days ago at EUR 1.1645. We will get a speech from Huw Pill this morning. He has the snappy title of Chief Economist and Executive Director for Monetary Analysis and Research at the BOE. He also has very long business cards. His views on these employment stats will?be sought, no doubt.

Euro slips ahead of German inflation and ZEW?sentiment

As well as losing?a little bit of?ground against the pound, the euro has also slipped against the US dollar. The EUR/USD rate is down to $1.0785 this morning, ahead of?Germany’s?consumer price inflation data and an economic sentiment survey from the highly respected ZEW institute.?We're?not expecting any change to?Germany's?2.2% inflation figure, but there is a feeling the ZEW index will produce a slightly less negative result.?i.e. something like 46.1 as opposed to the previous?month’s?43.9; so, not as pessimistic as before but not into the positive sentiment end of the index, above the 50 level.?If this data is as expected, there is nothing?there?to support the euro?but?higher inflation or a stronger economic sentiment would bring the euro buyers out of the woodwork.?

Today's?Major Economic Releases

12:30 AUD Producer Price Index ex Food & Energy (YoY)(Apr)?

14:00 USD Fed's Chair Powell speech?

Interbank Exchange Rates