US Nonfarm employment falls 51,000, Unemployment rate increases. Dollar gains in forex trading. | CountingPips Forex & Currency Trading Blog

August 1, 2008 - Forex Economic News

US Nonfarm employment falls 51,000, Unemployment rate increases. Dollar gains in forex trading.

U.S. Nonfarm Payrolls employment data released today showed that jobs fell by 51,000 workers in the month of July. The Department of Labor nonfarm payrolls report showed a decline for the seventh straight month as the unemployment rate increased to 5.7 percent in July. The employment results where better than than expected as market forecasts were predicting a drop of approximately 75,000 jobs. The nonfarm payrolls in June declined by a revised 51,000 jobs after US Economic News - Fx Trading the initial government estimate of a 62,000 decrease.

The unemployment rate rose by 0.2 percent in July to 5.7 percent as the number of unemployed persons grew to 8.8 million. Market forecasts had predicted only a rate increase of 0.1 percent. The jobless rate has seen a gain of 1.0 percent in the last twelve months as the number of unemployed has increased by 1.6 million workers in the same time frame.

Construction and manufacturing continued to be hard hit by job losses in July as they lost 22,000 jobs and 35,000 jobs, respectively. Professional and business services showed a decline of 39,000 jobs. Education and health services combined to show 39,000 jobs gained in the month with leisure and hospitality as well as government employment also making employment gains in May. Hourly earnings rose 0.3 percent or 6 cents in July after June's rise of 5 cents.

ISM Manufacturing data virtually unchanged.

U.S. Manufacturing data, released today by the Institute for Supply Management, showed that manufacturing activity remained basically unchanged in July from June. July's ISM Report On Business index reading for economic activity was at 50.0 following June's reading of 50.2. A score above 50 is considered to be growth and less than 50 is considered to be contraction in that sector. Market forecasts were predicting a reading of 49.0 for the month of July. The report showed that the overall economy grew for the 81th straight month.

Norbert J. Ore, chairman of the ISM Business Survey Committee, stated in the report that, "In this month's report, manufacturers indicate no change in overall business activity when comparing July to June. This continues a trend biased toward relatively minor contraction established more than 12 months ago. Manufacturing has maintained a reasonable level of activity during a period in which other sectors of the economy have been in recession."

The indexes for new orders, inventories, customers inventories, prices, exports and backlog of orders all showed contracting levels for July while production, employment and imports all showed growth for the month. New orders fell by 4.6 points to a reading of 45.0 in July and have contracted for the eight consecutive months.

The U.S. dollar has gained against the euro, pound sterling, New Zealand dollar, Australian dollar, Canadian dollar and Swiss franc today in the forex markets while falling a bit verses the yen. The dollar traded as low as 1.5516 verses the euro today before giving back some of its gains and looks to be on its way to its third straight weekly gain against the European currency. In addition to the euro, the pound sterling, Aussie dollar, New Zealand dollar and Canadian dollar are all losing ground to the dollar for the second straight weekly close with the Swiss franc on its way to losing ground for the third consecutive week.

Next week's forex economic events are highlighted by four interest rate announcements with the Reserve Bank of Australia, United States Federal Reserve, European Central Bank and the Bank of England all making interest rate decisions.

EUR/USD Chart - The euro losing ground vs. the us dollar for the third straight week.

tags: forex trading, employment, jobless, manufacturing, fx trade

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