Britain’s unemployment rate unexpectedly fell again to 4.8% between January and March, a period which the country spent under a tight COVID lockdown, and hiring rose further in April, data showed on Tuesday.
Economists polled by Reuters had mostly expected the unemployment rate to hold at 4.9%.
The data added to signs that Britain’s labour market has not suffered the severe hit feared at the onset of the coronavirus pandemic, in large part due to the government’s huge jobs subsidy programme.
The number of people in employment jumped by 84,000 in the first quarter of 2021, the first increase since the coronavirus crisis began and a stronger increase than the median forecast of a 50,000 rise in the poll. Those classed as unemployed fell by 121,000.
However, the inactivity rate – measuring people who are not looking for work – rose and was a record high for men.
The dollar weakened in early European trade Tuesday as comments from Federal Reserve officials pointed to the central bank holding onto its ultra-easy monetary policies for some time yet.
At 2:55 AM ET (0755 GMT), the Dollar Index, which tracks the greenback against a basket of six other currencies, was down 0.2% at 89.955, falling to its lowest level since late February.
EUR/USD traded 0.3% higher at 1.2183, climbing to its highest level since Feb. 26, USD/JPY was 0.1% lower at 109.08, after data showed Japan’s economy contracted more than expected due to coronavirus infection, while the risk-sensitive AUD/USD rose 0.5% to 0.7802.
The dollar had pushed higher last week after consumer prices jumped sharply, suggesting the Federal Reserve would feel the pressure to rein in its accommodative policies sooner than it had guided.
Oil prices extended gains on Tuesday as hopes of a solid recovery in fuel demand following the reopenings of the U.S. and European economies offset concerns over spreading COVID-19 cases in Asia.
Brent crude oil futures were up 33 cents, or 0.5%, at $69.79 a barrel by 0644 GMT, while West Texas Intermediate (WTI) was up 30 cents, or 0.5%, at $66.57 a barrel.
Both contracts rose more than 1% on Monday.
“Behind the gain is growing optimism of strong recovery in gasoline and other fuels in the United States and Europe in light of easing of various pandemic-related restrictions,” said
Chiyoki Chen, chief analyst at Sunward Trading.
“There are concerns about spreading infection cases in Asia, but it will be solved in a matter of time as the vaccine spreads,” he added, predicting that Brent prices will be headed toward $75 a barrel later this month.
U.S. President Joe Biden will send at least 20 million more COVID-19 vaccine doses abroad by the end of June, marking the first time the United States is sharing vaccines authorized for domestic use.
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