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Upcoming jobs data out of the United Kingdom could spark a reversal in GBP/USD rates, should the unemployment rate in June exceed the consensus forecast 4.2%.

This economic data may hold substantially more weight than usual when considering the ongoing tapering and ultimate cessation of the British government’s £33.8 billion furlough scheme in October.

Given the measures are estimated to have supported the payrolls of over 9 million workers, premature withdrawal could see UK jobless numbers jump above 3 million and the unemployment rate surge to 10% by the end of the year, according to the National Institute of Economic and Social Research.

This assessment is in stark contrast to the relatively rosier outlook painted by the Bank of England, with committee members projecting the unemployment rate to rise “to around 7.5% by the end of the year” despite admitting “considerable uncertainty remains about the prospects for employment after those support schemes unwind”.

With the central bank assessing that “the existing stance of monetary policy remains appropriate”, a marked increase in the level of unemployment may force the BoE to reassess its current wait-and-see approach and could lead to the expansion of the current £750 billion quantitative easing (QE) program.

To that end, GBP/USD rates may come under significant pressure if employment data surprises to the downside, possibly resulting in investors positioning for the provision of more monetary stimulus and discounting the British Pound against its major counterparts.

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