The British pound moved lower Wednesday morning, following a disappointing UK jobs report. Sterling had made gains against the dollar earlier, as an US electoral win for Democrat Doug Jones in Alabama, weakened the Republican’s Senate majority.
By 1030 BST, the British pound was trading at $1.3352, While that was higher than the $1.3323 it hit at the UK market close, Tuesday, it was down from the $1.3363 level, from just ahead of the UK unemployment data release.
Jobs data disappoints
Earlier Tuesday the Office for National Statistics (ONS) published its latest jobs and earnings data. The figures were mixed.
The number of Britons in employment fell to 32.08 million in the three months to October, a drop of 56,000 from the three months to July. That was the largest drop since 2015 and the second consecutive decline in the measure, the ONS data show.
Unemployment, meanwhile, fell to a fresh record low of 1.43 million. The rate was unchanged at 4.3%, from the three months to September. And, average earnings growth ticked higher to 2.3% in the three months to October, from 2.2% in September.
It was the decline in employment that likely weighed on investor sentiment. That’s because it suggests jobs growth has slowed amid ongoing Brexit uncertainty.
In addition, despite the mild increase in earnings growth, real earnings fell for an eighth straight month.
“Real earnings (adjusted for inflation using the Consumer Prices Index including owner occupiers’ housing costs (CPIH) decreased by 0.2%, including bonuses and by 0.4%, excluding bonuses,” the ONS said.
British pound gives back US politics-related gains
The jobs-data induced weakness in the British pound, follows earlier gains made when a US Democrat candidate secured a win in the state of Alabama, for the first time in 25 years.
The campaign has been a tough one, with Republican candidate Roy Moore accused of sexual misconduct with teenage girls. He also has a reputation as a controversial figure, making remarks which include that Muslims aren’t fit to serve in Congress.