Pound-to-Euro Higher on UK Jobs Report

July 17, 2025 - Written by Tim Boyer

STORY LINK Pound-to-Euro Higher on UK Jobs Report

The Pound Euro (GBP/EUR) exchange rate wavered higher on Thursday following the UK’s latest jobs data.

At the time of writing, GBP/EUR was trading at €1.1555, up around 0.2% on the day.

The Pound (GBP) drifted higher on Thursday, though its path was far from steady, as markets responded to a mixed set of UK labour market figures.

Sterling initially firmed after data showed employment surged by 134,000 in the three months to May, far outpacing expectations of a 46,000 rise. The unemployment rate did edge up from 4.6% to 4.7%, but analysts largely attributed the increase to a rise in labour force participation.

However, the upbeat reaction faded as investors absorbed weaker details elsewhere in the report. Wage growth cooled during the same period, while the number of payrolled employees dropped by 41,000 in June. Unemployment benefit claims also rose more than forecast, adding to signs of a softer tone in the jobs market.

This saw the Pound pare its earlier gains amid renewed speculation that the Bank of England (BoE) could move forward with additional interest rate cuts in response to a potential slowdown in labour market momentum.

Yet despite these headwinds, Sterling then gradually regained ground. After trimming its post-data advance, the currency edged higher once again, with the mixed report eventually lending GBP support.


The Euro (EUR) traded without clear direction on Thursday, struggling to find momentum amid a quiet day for Eurozone data and a broadly upbeat mood in global markets.

With no major economic releases to drive price action, the safe-haven single currency lost some of its appeal as risk appetite improved, with investors favouring higher-yielding assets over traditional safe havens like the Euro.

Adding to the subdued tone, the Euro continued to feel the pressure of its inverse relationship with the US Dollar (USD), which edged higher through the session. The strong negative correlation between the two currencies kept EUR pinned down as USD strength limited any potential upside.

Looking ahead, the Euro could come under renewed pressure on Friday as investors digest Germany’s latest producer price index (PPI). Economists expect wholesale prices to have stagnated on the month in June, with the annual figure projected to show a 1.3% decline.

Should the data reinforce signs of subdued inflation in the Eurozone’s largest economy, it may bolster expectations for further European Central Bank (ECB) rate cuts, potentially weighing on the single currency.

In contrast, the Pound may find itself lacking direction, with no notable UK economic releases scheduled. Without fresh domestic catalysts, GBP is likely to take its cues from broader market sentiment.

As risk appetite continues to play a growing role in Sterling’s short-term movements, a downturn in the global market mood could leave the increasingly risk-sensitive Pound vulnerable to losses.

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TAGS: Pound Euro Forecasts