Unexpected drop in US unemployment – Mexican Peso falls again
Unexpected drop in US unemployment – Mexican Peso falls again
02-06-2010 15:26
The unemployment level in the US dropped surprisingly last month, reaching the lowest rate in five months, according to official data released by the Labor Department. January’s level was 9.7%, while December showed a 10% rate. However, American companies cut 20.000 jobs last month, while many analysts had forecasted that the economy would provide jobs.Job creation
The US president Barack Obama has announced that job creation would be his most important task. January proved to be the month with the smallest number of job losses since the economic slump hit the US, although last year’s November showed an unexpected increase in employment.Job market gradually improves
Christina Romer, White House economic adviser, commented: “Today’s employment figures provide optimistic signs that the job market gradually improves, despite the fact that joblessness is still a grave problem.”Positive signs
In January 2009, the US lost 779.000 jobs. Analysts forecasted that the unemployment level would increase to 10.1% in January, and that 5.000 net jobs would be created. Despite the fact that US companies cut more jobs than they created, there were several sectors of the economy that showed positive signs.Manufacturing
Manufacturing created 11.000 new jobs last month, the most since April last year. In the meantime, retailers added 42.100 new jobs; its best performance since November 2007. The clear inconsistency between the jobless rate dropping, and American companies cutting jobs last month, is the result of the fact that two different surveys provided the figures. The data regarding new jobs come from employers, while the unemployment level is based on households.Mexican Peso
Yesterday’s trading circumstances were completely against the Mexican Peso, as Mexico’s most important trading partner, the US, released figures that were below expectations. In the meantime, the Mexican currency also faced a major sentiment of negativity, as a result of deteriorating public accounts in Europe.Global market sentiment
US employment figures demonstrated a rise in new unemployment claims, which was rather disappointing, and forced the Mexican currency down for another day. In the meantime, Mexico’s main export product, crude oil, dropped after the global market sentiment became more gloomy, particularly in the Euro area where some members are facing difficulties in resolving their budget deficits, indirectly decreasing the attractiveness of emerging market currencies.
