Euro Area Employment Recovery Endures

Although the measure still remains stunningly high relative to other advanced global economies, the Euro Area has continued to make progress on fighting unemployment despite the complete absence of fiscal stimulus measures.  The unemployment rate fell to 9.80% during the month of October, marking the best reading since July of 2009.  Besides the great headline figure, the prior month’s figure was also revised lower as the extremely loose monetary policy environment helps stimulate private sector investment.  According to recent comments from officials and analysts, the European Central Bank is forecast to announce an extension of its existing asset purchase program for an additional 6-months even though there have been difficulties in expanding the available supply.  After closing flat on Thursday, EURGBP is back under pressure, trending around 0.8450.

After five straight quarters of growth, the latest Swiss gross domestic product figures underscored an economy that is struggling to grow in a challenging trade environment.  Data reported earlier in the session showed that quarterly growth slowed to 0.00% during the third quarter, with the annualized pace of growth slowing to 1.30% from the 2.00% recorded a quarter earlier.  Besides trade faltering and import growth of 0.20% handedly outpacing the export contraction of -0.20%, sliding government spending was a key driver behind the rapid deceleration in economic expansion.  Although investment and consumption rose during the period, helping to balance out the shrinkage in other figures, the outlook remains precarious as Switzerland struggles to exit from deflation.  In the meantime, the Franc is reversing modestly after steep gains versus the US dollar a session earlier.