GBP/JPY trims gains after mixed UK jobs data, back around mid-140.00s

The GBP/JPY cross extended previous session’s recovery move from near two-month lows, albeit trimmed some of its early gains 141.00 neighborhood after mixed UK labor market report.

According to the latest UK monthly jobs data, released just a while ago, the number of people claiming unemployment-related benefits fell more-than-expected to 7.3K during May, while the unemployment rate held steady at 4.6%. 

The disappointment, however, came from lackluster weekly earnings data, with 3mth-year growth at 2.1% as against 2.4% expected. Excluding bonus, weekly earnings rose 1.7% as compared to 2.0% expected and 1.8% previous. 

Disappointing earnings growth seems to have negated some of the optimism led by rising inflationary pressure and failed to provide any additional boost to the British Pound, dragging the cross back towards mid-140.00s. 

Focus now shifts to the key central bank monetary policy decisions on Thursday - BOJ, followed by BOE, which would help determine the next leg of directional move for the cross. 

Technical levels to watch

Weakness back below 140.20 level, leading to a subsequent break through the key 140.00 psychological mark, would turn the cross vulnerable to head back towards the 139.00 handle, with some intermediate support near 139.55 level.

On the flip side, strong follow through buying interest beyond 141.20 level is likely to accelerate the short-covering move towards 141.85 intermediate resistance en-route next major hurdle near 142.35-45 region.