Trade Desk Thoughts - U.K. Average Earnings Index

U.K. Average Earnings Index Actual 3.5%, Expected 3.4%, Previous 3.4%

Release Explanation: This release measures the change in the prices that businesses and governments pay for labor. Although, this report does not take into account all sources of household income but the labor cash earnings does accurately reflects the spending ability of domestic, which is one of the driving forces of economic growth.

Trade Desk Thoughts: Average earnings, including bonuses, rose by 3.5 percent year over year, up from 3.4 percent in June. Analysts expected a 3.4 percent read. Wage inflation is something the BoE takes into account when formulating the monetary policy. A rising trend puts strong pressure on the CPI read.

Forex Technical Reaction: The pound fell 40 pips at the time of the release, and is now trading just under the neutral pivot point (1.7850).

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