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United Kingdom GBP

United Kingdom Unemployment Rate

Impact:
High
Source: Office for National Statistics

Latest Release:

Date:
Surprise:
-0.1%
| GBP
Actual:
4%
Forecast: 4.1%
Previous/Revision:
4.1%
Period: Aug

Next Release:

Date:
Period: Aug
What Does It Measure?
The United Kingdom Unemployment Rate measures the percentage of the labor force that is unemployed and actively seeking employment. It primarily focuses on the labor market's health, assessing production capacity, labor supply, and overall economic activity.
Frequency
This report is released monthly, and it typically provides a preliminary estimate that may be revised in subsequent releases, usually coming out around the middle of each month.
Why Do Traders Care?
Traders closely monitor the unemployment rate as it directly affects economic growth prospects and consumer spending. An unexpected increase in unemployment can lead to bearish sentiment in equities and the currency market, while a decrease might bolster confidence and lead to bullish trends.
What Is It Derived From?
The unemployment rate is derived from the Labour Force Survey (LFS), which collects data from approximately 40,000 households using a standardized questionnaire. This data assesses whether individuals are actively seeking work and are available for employment to calculate the rate of unemployment accurately.
Description
The unemployment rate is reported as a percentage of the total labor force, which includes those actively seeking employment and does not account for those not in the labor force. It provides critical insights into economic conditions, often impacting policy decisions by the Bank of England regarding interest rates and quantitative easing measures.
Additional Notes
The unemployment rate is generally considered a lagging indicator since it reflects past economic conditions and can influence future monetary policy decisions. It is often analyzed alongside other indicators like inflation and GDP growth to gauge the economy's overall trajectory.
Bullish or Bearish for Currency and Stocks
If the unemployment rate is reported lower than expected: Bullish for GBP, Bullish for Stocks. If higher than expected: Bearish for GBP, Bearish for Stocks. A dovish tone: Signaling economic concerns due to rising unemployment is usually bad for the GBP but good for Stocks due to lower borrowing costs.

Legend

High Potential Impact
This event has a strong potential to move markets significantly. If the 'Actual' value differs enough from the forecast or if the 'Previous' value is significantly revised, it signals new information that markets may rapidly adjust to.

Medium Potential Impact
This event may cause moderate market movement, especially if the 'Actual' deviates from the forecast or there's a notable revision to the 'Previous' value.

Low Potential Impact
This event is unlikely to affect market pricing unless there's an unexpected surprise or a major revision to prior data.

Surprise - Currency May Strengthen
Actual deviated from Forecast on a medium or high impact event and historically could strengthen the currency.

Surprise - Currency May Weaken
Actual deviated from Forcast on a medium or high impact event and historically could weaken the currency.

Big Surprise - Currency More Likely To Strengthen
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely strengthen the currency.

Big Surprise - Currency More Likely To Weaken
'Actual' deviated from 'Forecast' more than 75% of historical deviations on a medium or high impact event and may likely weaken the currency

Green Number Better than forecast for the currency (or previous revise better)
Red Number Worse than forecast for the currency (or previous revise better)
Hawkish Supports higher interest rates to fight inflation, strengthening the currency but weighing on stocks.
Dovish Favors lower rates to boost growth, weakening the currency but lifting stocks.
Date Time Actual Forecast Previous Surprise
Oct 15, 2024
4%
 4.1%
4.1%
 -0.1%