The pound was higher against its major counterparts in the European session on Tuesday, as the U.K. unemployment rate unexpectedly fell in the December to February period.

Data from the Office for National Statistics showed that the jobless rate fell to 4.9 percent in three months to February. Economists had forecast the rate to rise to 5.1 percent from 5 percent in three months to January.

At the same time, the employment rate dropped 0.1 percentage points from the previous quarter to 75.1 percent.

Annual growth in average employee pay continued to strengthen, the growth was driven in part by compositional effects of a fall in the number and proportion of lower-paid employee jobs.

In three months to February, average earnings including bonus grew 4.5 percent annually and earnings excluding bonus advanced 4.4 percent.

In March, the claimant count rate held steady at 7.3 percent. The number of people claiming unemployment benefits increased by 10,100 from February.

European stocks fell, pulling back from record highs reached a day earlier as the yield on the 30-year Treasury bond climbed and new Covid-19 cases continued to rise around the world, raising concerns over a disconnect between fundamentals and high equity valuations.

The pound spiked higher to 1.2817 against the franc, its highest level in nearly two weeks. If the pound climbs further, 1.29 is likely seen as its next resistance level.

The pound jumped to near a 2-week high of 151.98 against the yen from Monday’s close of 151.20. On the upside, 153.00 is possibly seen as its next resistance level.

Data from the Ministry of Economy, Trade and Industry showed that Japan’s tertiary activity rose for the first time in three months in February.

The tertiary activity index grew 0.3 percent month-on-month in February, after a 1.0 percent decrease in January.

The pound held at its strongest level since March 4 against the dollar, at 1.4009. The pound is seen finding resistance around the 1.42 area.

In contrast, the pound edged lower to 0.8634 against the euro, compared to Monday’s closing quote of 0.8604. The pound is likely to find support around the 0.88 region.

Data from Destatis showed that Germany’s producer prices increased in March at the fastest pace since late 2011 driven by higher energy and intermediate product prices.

Producer price inflation accelerated sharply to 3.7 percent in March from 1.9 percent in February. This was the biggest increase since November 2011 and faster than the expected rate of 3.3 percent.

The material has been provided by InstaForex Company – www.instaforex.com

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