Swedish unemployment rate up in July and New tax regulation boosts Yen

08-27-2009 12:33

The Swedish jobless rate rose in July in comparison with the same period in 2008, reported Statistics Sweden (Statistiska Centralbyrån (SCB)) today. The Japanese Yen continued to rise on the back of speculations that Japanese investors are repatriating foreign assets to the nation in order to benefit from a new tax regulation, boosting the Japanese currency to continue its rise while the circumstances are rather negative.

Swedish unemployment up

Sweden demonstrated a total of 398.000 people without a job in July, which is 7.9% of the working population, in comparison with last year’s 5.8%, while economists forecasted 8.2%. In the meantime, the employment rate declined 2.9% in comparison to last year’s 66.8%, as it totals up to 4.646.000, with 635.000 persons working in the energy, mining and quarrying environment and industrial segments. The Swedish state statistics agency also announced that the amount of hours worked declined by 6.7% to 80.7 million per week on average in comparison to the corresponding period of the previous year.

Yen boosted

The Japanese Yen gained for the third consecutive day against many of the 16 most popular currencies as a result of several factors that boosted the Japanese currency. Today’s rumors suggested that the US gross domestic product numbers of the last quarter will demonstrate a deeper slump than the first one, which will increase the attractiveness of the comparative safe-haven Yen. Japanese exporters are bringing back overseas investments capital back to the nation in order to profit from a new tax law, which causes the Pound Sterling to drop against the Japanese Yen, despite the strongest increase in UK home prices today.

New tax regulation

This week of gaining by the Yen is strongly linked with the new law in China that was authorized to prevent a continuation of the financial disorder in the nation while it generates a bearish sentiment in trading markets. The US gross domestic product figures of today are also resulting in a pessimistic tone of the market climate as an extended US slump would surely increase risk aversion in trading markets, boosting the demand for the Japanese Yen.