arrow
logo

Alvexo - Giving Back To The Community

Learn More

EU Unemployment Improves

Joblessness Rates Improve Among Major Advanced Economies

shutterstock_124638196

Euro Area European employment continued to improve after the jobless rate indicated gains from extraordinary policy measures undertaken by the European Central Bank.  If the unemployment rate continues to improve, inflation targets may be within reach for economies struggling to overcome disinflationary pressures.

Unemployment Falls Across Europe

Europe’s statistics office reported an unemployment rate of 10.50% in November, down from the revised 10.60% of the prior month for the Euro Area in a strong indication of slow and moderate improvement in underlying fundamentals. The unemployment rate currently sits at the lowest level in more than 4-years but still remains elevated relative to other advanced economies. Of the Euro Area’s largest constituent economies, Germany recorded the lowest unemployment rate at 4.50% whereas Spain had the highest at 21.40%. Compared to last year’s 23.70% in November, Spain has showed improvement alongside Italy which saw the jobless rate at 11.30% versus last year’s 13.10%. Eurostat economists underlined the growing confidence amongst regional industrial firms has led to increased hiring and an improvement in sentiment, as record low rates from the ECB benefits the aggregate economy.

popup_close
eurgbp01082016

US Jobless Claims Recover

Citizens of the United States filing for unemployment for the first time for the week ending January 2nd, rose to 277,000 exceeding estimates of 275,000 but decreasing from last week’s 287,000. As consumer spending which accounts for 70% of the US economy continues to show improvement, employers are retaining and adding workers to payrolls. This latest reading marked the 44th-consecutive week where unemployment stayed below the key 300,000 level thought to represent a healthy labor market. The 4-week moving average for claims slipped to 275,750 from prior week’s 277,000. The ADP Research Institute reported on Wednesday that private payrolls in December achieved its biggest increase in a year. Companies hired 257,000 workers in December with the data should reinforcing positive views of the economy's health despite the battle against a stronger dollar and mounting layoffs in the energy patch.

popup_close
dow-mar1601082016

Canada Ready to Accommodate Further

The Bank of Canada reported its readiness to utilize both conventional and unconventional tools to reduce the country’s risks in reaching inflation targets. As oil and other commodities are continuing to plunge, Governor Stephen Poloz remarked in a speech yesterday “that policy makers should start to facilitate necessary adjustments” in response to the decline in the economy. The move by the United States Federal Reserve to raise interest rates might directly impact the Canadian dollar, keeping it weak over the medium-term as policy diverges further. Analysts are currently expecting additional cuts to Canada’s key interest rates. The benchmark rate is currently sitting at 0.50% with forecasts showing rates falling back towards record lows of 0.25% seen last in April 2009 during the global crisis. The next Bank of Canada decision that could see a change in strategy is due on January 20th.

popup_close
usdcad01082016

Australian Retail Match Estimates

Australian retail sales grew 0.40% for the month of November, in-line with expectations although representing a modest slowdown from October’s revised 0.60%. The figures marked the fourth consecutive month of retail sales growth with Christmas also expected to see further improvements, indicating reasonably steady consumption in the country. The Australian Bureau of Statistics report showed that major gains came from household goods spending rising 0.90% with spending at cafes and restaurants climbing 1.00%. In a growing sign of the prowess of ecommerce, online retail sales jumped 0.70% from October’s contraction of -0.60% on the back of Cyber Monday sales. Nevertheless, the economy is facing risks, especially thanks to risks of a contraction in Asia and moderating housing prices.  However, strengthening conditions in labor market conditions and accommodative policy should give provide strong tailwinds for retail.

popup_close
audusd01082016

Upcoming Events

  • Time
  • Currency
  • Event
  • Forecast
  • Previous
  • 13:30 GMT
  • USD
  • Nonfarm Payrolls (December)
  • 200K
  • 211K
  • 13:30 GMT
  • USD
  • Unemployment Rate
  • 5.00%
  • 5.00%
  • 13:30 GMT
  • CAD
  • Employment Change (December)
  • 10.0K
  • -35.7K
  • 13:30 GMT
  • CAD
  • Unemployment Rate
  • 7.10%
  • 7.10%