Latest data released by ONS - 13 August 2019

  • Prior +3.4%; revised to +3.5%
  • Average weekly earnings (ex bonus) +3.9% vs +3.8% 3m/y expected
  • Prior +3.6%
  • ILO unemployment rate 3.9% vs 3.8% expected
  • Prior 3.8%
  • Employment change 115k vs 60k expected
  • Prior 28k
  • July jobless claims change 28.0k
  • Prior 38.0k; revised to 31.4k
  • July claimant count rate 3.2%
  • Prior 3.2%

Yet another solid report though the slight tick higher in the unemployment rate takes the shine off the more robust wages data. For the ex-bonus reading, the headline is the highest since June 2008 with June alone contributing to a +3.9% y/y increase.

In real terms, total weekly earnings is seen at +1.8% 3m/y and that is the highest since June 2016, continuing the stronger trend in wage pressures over the last few months.

That said, the more solid report here will do little to shift the dial in the pound in the big picture as it won't affect the BOE outlook nor tinker with Brexit uncertainty.

Cable is still seen ranging around 1.2055-70 for the time being and I reckon any further pick-up towards 1.2100 and the 100-hour MA @ 1.2105 will see sellers step in.