GBP Loses Ground Against USD, EUR As Investors Worry Resurface

Summary

  • GBP retreated moderately against USD and euro on Tuesday, 20 April,
  • BoE fixed a currency conversion rate of 1.3984 USD vs a unit of pound sterling

The Great Britain pound (GBP) retreated moderately against the United States dollar and the euro in the late trades on Tuesday, 20 April, even after the unemployment rate fell to a three-month low in February 2021. According to the data released by the Office for National Statistics (ONS), the UK’s unemployment rate slipped to a three month low of 4.9 per cent in February, exceeding the expected outcome of 5.1 per cent.

The jobs have been thoroughly supported by the furlough scheme but the outlook remains bleaker after the job support scheme ends. As far as the employment level is concerned, there were 827,000 lesser employed people across the United Kingdom in February 2021 as compared to the same month in the previous year.

February 2020 was the last month that can be designated in the pre-pandemic era when the repercussions of coronavirus and the rate of infection began to escalate. As per the figures released by the ONS, there were 28.2 million employees on the payroll in March 2021, down by 56,000 as compared to the total individuals on the payroll in February 2021.

“The latest figures suggest that the jobs market has been broadly stable in the recent months after the major shock of last spring. The number of people on payroll fell slightly in March after a few months of growth,” said Darren Morgan, Director of Economic Statistics at the ONS.

Subsequent to the dejection led by the employment data, the GBP to USD pair traded at 1.3963, down 0.15 per cent from the previous close of 1.3983. During the day so far, the currency pair has shuttled between a broad range of between 1.3950 and 1.4010, respectively, at the interbank foreign exchange market.

GBP vs USD (20 April)

(Source: Refinitiv, Thomson Reuters)

The GBP to EUR pair traded in a much similar fashion. At around 1449 GMT, the GBP to EUR was trading at 1.1587, down 0.26 per cent from the previous close of 1.1617. The Bank of England had fixed a currency conversion rate of 1.3984 USD and 1.1634 EUR against a unit of pound sterling on 19 April.


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