GBP/USD faces pressure as UK hiring slumps despite firm wage growth

GBP/USD has declined 0.2% to 1.2645 as UK labor market data revealed continued weakness in hiring activity. UK permanent placements fell for the 39th consecutive month in December, with the pace of decline accelerating to a four-month high. Despite the hiring slump, starting salaries rose at their strongest rate since May, creating a complex scenario for the Bank of England. The persistent wage pressures, combined with weakening employment trends, complicate the BoE's monetary policy outlook as officials must balance inflation concerns against economic slowdown risks. Recent payroll tax increases continue to weigh on recruitment activity, further dampening the jobs market. Technical analysis shows GBP/USD testing support at 1.2640, with resistance at 1.2680. The divergent signals between employment weakness and wage strength suggest continued volatility for sterling, with traders closely watching upcoming BoE communications for policy direction clarity.