US jobless rise stokes fear of stumbling economy
The US unemployment rate rose to 9.1%, from 9% in April, the highest jobless rate since December. This unemployment figure is stoking fears of a stumbling US economy and adds to speculation that the Federal Reserve Bank may initiate a new round of...
The US unemployment rate rose to 9.1%, from 9% in April, the highest jobless rate since December. This unemployment figure is stoking fears of a stumbling US economy and adds to speculation that the Federal Reserve Bank may initiate a new round of quantitative easing once the current round expires this month.
Non-farm payrolls in the US rose by a seasonally adjusted 54,000 in May, the smallest gain since September 2010, and way off analysts’ expectations of 165,000 jobs.
Meanwhile, British manufacturing activity slowed in May as weaker domestic demand, particularly for consumer goods, and the slowest growth in export orders in eight months, put the brakes on growth in the sector to its slowest pace in 20 months.
The Purchasing Managers Index headline figure for the sector registered at 52.1 last month versus market participants’ expectations of 54.1.
Manufacturing, which accounts for about 13% of UK economic output, had been one of the few success stories during a slow return to growth after a recession that ended in late 2009.
Eurozone inflation slowed in May as lower oil prices brought the Consumer Price Index to an annual level of 2.7% for the month.
Last month’s figure is still above the European Central Bank’s medium-term target of 2% and just slightly below economists’ expectations of a 2.8% rate year–on-year.
Yet market participants doubt that May’s slowdown in price levels is likely to stop the ECB from raising its refinancing rate in July.
The unemployment rate for the 17-nation area was unchanged at 9.9% in April, the third consecutive month at this level, despite small declines in the number of jobless in Germany, France and Italy.
The continuing high level of people out of work reflects a varied job market across the region, with improving labour markets in Germany and other core northern euro economies contrasting with stubbornly high unemployment in the struggling periphery economies.
This article was compiled by Bank of Valletta plc for general information purposes only.