Today in the economy

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3/6/09


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USA - Unemployment Rate

Actual8.10%|Forecast7.90%|Previous7.60%

Determines the percentage of total work force that is unemployed and actively seeking employment during the last quarter. A downward trend has a positive effect on the nation's currency as working people tend to spend more money, and consumption makes up a large portion of GDP.

This strikes me as a bit of a sloppy statement. For starters it is not exactly clear what they mean by "a positive effect on the nation's currency" Maybe an inverse relationship between the unemployment rate and the exchange rate can be described, but they sure haven't done it here.

I agree this is a little vague. It would be interesing to see a chart that shows unemployment vs. exchange rates.

Paging Mr. Kirkland Laing......................paging Mr. Kirkland Laing................you're needed in the lobby.

Hmmm, now that I think about it, I suppose if domestic consumption goes up, then business is better and then more people want to invest in your country which would tend to upward pressure on your exchange rate. But it seems like an "other things being equal scenario". It depends what is happening in the other countries that the domestic currency is being measured against.

Interestingly enough, the Canada-US exchange rate (the value of the Canadian Dollar relative to the US Dollar) has fallen heavily in the last several months