The British pound weakened against other major currencies in the European session on Tuesday, after data showed that the average earnings in the U.K. grew better than expected in March and the jobless rate rose slightly, while the fall in employment was less than expected and vacancies continued to decline, giving more evidence of a cooling labor market to Bank of England that is preparing to lower interest rates soon.

Data from the Office for National Statistics showed that the unemployment rate for those of age 16 and older rose to 4.3 percent in the three months to March, which was in line with expectations.

The claimant count increased by 8,900 on the month to total 1.579 million in April, which was much less than the 13,900 economists had forecast.

Employment decreased by 178,000 persons from the previous period, which was much smaller decrease than the 215,000 slump economists were looking for.

The number of vacancies decreased by 26,000 sequentially in February to April to 898,000 jobs. Vacancy numbers decreased on the quarter for the 22nd consecutive period, the ONS said.

Wages excluding bonuses grew 6.0 percent year-on-year in the January to March period. Economists had forecast a gain of 5.9 percent in regular pay that serves as the preferred gauge for the Bank of England to measure wage inflation.

Pay including bonuses grew 5.7 percent annually in the three months to March. Economists had expected an increase of 5.3 percent.

In the European trading now, the pound fell to a 4-day low of 0.8616 against the euro, from an early 1-week high of 0.8587. The pound may test support near the 0.87 region.

Against the U.S. dollar, the pound slid to a 4-day low of 1.2509 from an early high of 1.2564. On the downside, 1.23 is seen as the next support level for the greenback.

Against the yen and the Swiss franc, the pound edged down to 195.73 and 1.1362 from an early 2-week high of 196.62 and nearly a 2-week high of 1.1414, respectively. The pound may test support near 190.00 against the yen and 1.11 against the franc.

Looking ahead, U.S. NFIB business optimism index for April, Canada new Motor vehicle sales and wholesale sales data for March, U.S. PPI for April and U.S. Redbook reports are slated for release in the New York session.

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