US jobless hits 9.8%

In the US, a survey showed that the jobless rate increased to a seven-month high of 9.8% in November from 9.6% in October. Economists were expecting the rate to remain flat.

In a separate survey, non-farm payrolls rose by 39,000 in November. This was far lower than the increase expected by economists.

The Institute of Supply Management manufacturing index for November came in at 56.6. This was in line with expectations, but lower than October’s 56.9 level.

Meanwhile, the Federal Reserve Beige Book indicated a slow improvement in conditions, and an index measuring consumer confidence rose to 54.1 from October’s revised level of 49.9.

In the eurozone, the jobless rate rose to its highest level in over 12 years. In fact, it rose to 10.1% last month, up from a downwardly revised 10% in October. Consumer prices held steady in November, with an annual increase of 1.9%.

The second reading of GDP for the third quarter of this year showed that the 0.4% growth of the EU-16 area was driven by household and government spending and exports.

Meanwhile, the European Central Bank left interest rates on hold at 1%, and there was no indication the bank would buy additional bonds. Special liquidity measures to support the banking sector were extended till at least April to combat liquidity difficulties.

In the UK, the past week was relatively light on economic data. On a positive note, the Purchasing Managers Index for the construction sector increased to 51.8 in November from 51.6 the previous month. Analysts were expecting the index to fall to 51.3. A reading above 50 in these sectors indicates growth.

A separate report showed mortgage approvals fell to 47,185 loans to buy homes in October, from 47,369 approvals the previous month. This was the lowest level registered during the past eight months. Economists were expecting loans to fall to 47,000.

Also in the housing sector, according to a report measuring house prices compiled by Nationwide Building Society, the average cost of homes dropped 0.3% from October when they fell by 0.7%. From a year earlier, prices rose 0.4%, lower than economists expectation of a 0.5% rise.

Finally, a measure of consumer confidence fell to -21 in November, much lower than the -19 reading of the previous month.

This article has been prepared by Bank of Valletta plc for general information purposes only.