Sterling rises after UK jobs rise eases BoE worries

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LONDON, Nov 16 (Businesshala) – The pound rose on Tuesday as data showed British employers hired more people in October after the government’s job-protecting furlough scheme ended, leaving banks Some concerns about the risks of raising interest rates in the Off England were eased.

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Fears of a slowdown in the jobs market following the end of the furlough scheme on September 30 prompted the BoE to surprise the market and maintain rates at its latest meeting, when sterling fell against the dollar in its deepest 14 months. she came. ,

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In early London trading, sterling rose after showing the number of employees on the payrolls of businesses in the UK rose from 160,000 in October to 29.3 million, up 0.8% in February 2020 compared to February 2020, based on data from tax officials.

Sterling rose 0.4% against the dollar to $1.3467 by 0930 GMT, after touching an 11-month low on Friday. It rose 0.4% to 84.38 pence against the euro.

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“This (job data) suggests that the roughly one million people who were on the furlough scheme at the end of September have largely returned to work,” UniCredit’s analysts said.

BoE Governor Andrew Bailey said earlier this month his vote to halt interest rates was too close. The lack of official data about what happened to the workers who were on leave even after the plan ended had forced them to wait.

“Given the lack of recession-proof in today’s strong jobs data, the case for a December 15 hike has now become stronger, and markets are almost entirely pricing in such a move,” ING told clients. Huh.”

The BoE may be the first major central bank to raise interest rates, but whether that initial hike comes next month or early next year has left economists surveyed by Businesshala.

Meanwhile, limiting sterling gains, there are concerns that a disagreement between Britain and the EU over Northern Ireland could trigger a major trade disruption, affecting the British economy, which is lagging behind that of other prosperous countries. Is.

Editing by Praveen Charu

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