canada loses jobs

Headlines: US adds jobs, Brazil inflates, big oil struggles…

In Business and Currency by Continental StaffLeave a Comment

Every week here at the Current we round up and breakdown the world’s biggest business stories. This week: the US adds jobs, but stock prices and the USD fall; Brazil suffering from inflation; the loonie hits a new low, but promising employment news; Shell, BP and Anglo American all suffer from low commodity prices.

US Adds jobs, stocks fall

According to the Bureau of Labor Statistics the US economy added 215 000 jobs last month, pushing the unemployment rate down to 5.3%. Many of the jobs that were added came in the retail, healthcare and financial industries. Employment statistics are considered a reliable barometer of economic health. The news, however, hurt stock prices and the value of the USD amid fears that the Fed would raise interest rates. Rates have been low in order to boost the economy, with a healthy economy the Fed will likely raise rates, lowering the value of the dollar and making loans more expensive.

Brazil Inflates

Brazil’s inflation rate is at a 12 year high of 9.56%. Rising energy costs are a major factor behind the increase. Brazil’s central bank has targeted an inflation rate of 4.5% and has raised interest rates to 14.25% in an attempt to contain inflation.

Low Loonie, good for Canada?

The Loonie sunk to an 11 year low against the USD. While vacationers may be suffering the poor exchange rate means that the Canadian economy might be able to take advantage of ‘staycations’ as Canadians spend their holidays – and their money – at home. The low value of the loonie may also be boosting the export sector. Statistics reveal that exports grew 6.3% overall to $44.6 billion in June, exports to the United States grew by 7%.

Canadian Jobs

Canada added only 6,600 jobs in July according to Stats Canada while the unemployment rate remained at 6.8%. As it continues to look unlikely that oil prices will rebound, the fear of economic trouble has been spreading across Canada with some even suggesting that the country could be on the brink of recession. In this context a decidedly neutral jobs report consisting of only a modest increase should be taken as good news.

Stuttering commodities

British Petroleum suffered a loss of $6.3 billion for the second quarter of 2015 due in no small part to costly litigation and settlements relating to the Deepwater Horizon Oil Spill. Royal Dutch Shell, a chief competitor of BP recently announced 6 500 layoffs and a 20% reduction in spending as it seeks to adjust to low oil prices. Anglo American – a global mining giant – has also been on the ropes lately. Stuttering commodity markets have forced Anglo American to lay off 53 000 employees.

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