Unemployment figures “provide welcome relief”

-Sterling hits session highs including a one month high against the euro-

London, 16 Dec 2009

Following the release of better-than-expected unemployment figures this morning, Sterling hit session highs against both the euro and the US dollar. Surging to a one month high against the euro, the pound hit €1.204, up 0.25 pc from €1.180. It also rose 0.25pc against the dollar, hitting $1.6299 from $1.6260.

Whilst the unemployment rate for November was confirmed at 7.9 pc - in line with market forecasts - the number of people claiming jobless benefit surprisingly declined. The October claimant count was also revised downwards from 12,500 to 5,900, whilst average earnings were shown to have stabilised.

Mark Bolsom, Head of UK Trading Desk at Travelex, the FX payments specialist, said, “This is great for Sterling’s short term outlook – the pound is still rising off the back of the data. The news will also provide welcome relief to those concerned about the pace of the UK’s economic recovery. No one was expecting to see a reduction in unemployment; most analysts were just hoping for some sign that the rate of job losses and average earnings had stabilised.

“Chancellor Alastair Darling has come under huge pressure lately over the size of the budget deficit, and a drop in the number of those dependent on state aid could not have come at a better time. The data will have a stabilising affect on consumer confidence and spending.

“It will also be interpreted as a further vindication of the Bank of England's decision to pause its asset purchasing scheme this month as the MPC wait to see the impact of its program so far.”

– Ends –

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Jessica Buttress
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Jessica.buttress@travelex.com

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About Travelex

Founded in 1976, Travelex is the world’s largest non-bank foreign exchange and payments specialist; with operations across four continents and 6,000 employees worldwide.

Travelex holds key positions in its three main areas of activity: Global Business Payments (TGBP, which includes Travelex Personal Payments), Currency Services and Card and Mobile Payments. Every year, more than 35,000 corporate clients and 30 million customers trust Travelex to manage their foreign exchange requirements.

Recently recognised by TowerGroup research as Industry Leader for payments innovation for SMEs, Travelex currently handles international payments worth £40 billion annually for over 750 large corporate and financial institutions.

Visit www.travelexbusiness.com/uk for more information or email the press office at Jessica.Buttress@travelex.com