FTSE 100 Rises as Pound Falls on UK Jobs Data

Catenaa, February 17, 2026 – The FTSE 100 edged higher after fresh UK labour data showed rising unemployment and slower wage growth. The pound weakened following the release.

Official figures showed the unemployment rate rose in the latest reading. At the same time, wage growth cooled compared with prior months. The data signalled easing pressure in the labour market.

Slower wage growth reduces the risk of persistent inflation. If pay pressures ease, the Bank of England faces less urgency to raise interest rates. Investors interpret that as supportive for equities.

Sterling fell against the dollar and euro after the report. Currency traders interpreted the figures as indicating a reduced need for further rate hikes. A weaker pound directly benefits the FTSE 100. Multinational firms dominate the index, as many generate revenue in dollars and euros.

When sterling falls, overseas earnings translate into higher reported profits. That dynamic often lifts share prices in export-heavy sectors.

Exporters and global firms place significant weight on the index. Energy, mining, and pharmaceutical stocks led gains. These companies generate significant foreign income. Currency movements, therefore, amplify earnings expectations.

Investors also assessed implications for the Bank of England. Slower wage growth could ease inflation concerns. Policymakers have been closely monitoring pay trends.

Markets now see a greater chance of policy stability in the coming months. Expectations for aggressive tightening have faded. That shift has helped equity sentiment.

However, domestic sectors face mixed prospects. Rising unemployment may pressure consumer spending. Retail and housing-related stocks remain sensitive to labour trends.

Bond yields moved modestly after the release. Traders adjusted rate expectations in response to softer data. The reaction suggests markets believe inflation risks are moderating.

Global factors also influenced trading. US market performance and commodity prices shaped risk appetite during the session.

The FTSE 100’s resilience highlights its defensive profile. Energy, mining, and pharmaceutical stocks provided support. These sectors often attract investors during periods of economic uncertainty.

Attention will now turn to upcoming inflation figures and central bank commentary. Further signs of cooling wage growth could reinforce expectations for steady rates.

For now, currency weakness is cushioning the benchmark index. The interaction between labour data, sterling, and monetary policy remains central to market direction.