What is the Unemployment Rate?
Unemployment Rate
Forex Trading Glossary
Quick Answer: The unemployment rate shows the share of the labor force that is jobless but actively seeking work. Shifts in unemployment influence central bank decisions and currency strength through growth and inflation expectations.
What is the Unemployment Rate?
The unemployment rate is the percentage of the labor force that is jobless and actively seeking employment. It's a key indicator of economic health and labor market strength. Low unemployment typically strengthens a currency, while high unemployment weakens it.
Impact on Markets
- Low unemployment: Strong economy, supports hawkish policy
- High unemployment: Weak economy, prompts dovish policy
- Falling rate: Job market improving (currency positive)
- Rising rate: Job market weakening (currency negative)
Key Release: Non-Farm Payrolls
US unemployment rate is released monthly alongside NFP on the first Friday of each month, causing significant USD volatility.
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