<?xml:namespace prefix = st1 ns = "urn:schemas-microsoft-com:office:smarttags" />UK ILO Unemployment Rate (3 months) (08:30GMT; 4:30EST)
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Actual: 5.6%
Expected: 5.5%
Previous: 5.5%
How Did the Markets React?
UK markets were very quick to react to the release of weaker than expected unemployment data out of the UK with currencies moving one way and stocks and bonds the other. The currency market reacted very poorly to the news that UK unemployment as measured by the international ILO standards rose to a decade long high of 5.6%. FX traders quickly liquidated their longs on the assumption that BoE will no longer be able to raise rates higher for fear of tipping the country into the recession. On the other hand bonds and equities welcomed the news as a more accommodative monetary policy by UKs central bank would be beneficial to both asset classes, by making capital less expensive to companies.
