Key Economic Updates – Remittance Source Countries

US jobless rate jumps to a four-year high of 5.7%

On 01 August 2008, the US Labour Department reported that the US non-farm payrolls fell for the seventh straight month in July, while the nation's unemployment rate jumped to 5.7%, recording a four-year high. Non-farm payrolls fell by 51,000 in July, led by a decline in the pace of manufacturing activity, construction and retail sectors. The unemployment rate rose 0.7% in the past three months, which is the fastest increase in the past 26 years.

Gauge of future US economy near a five-year low: ECRI

The Economic Cycle Research Institute (ECRI), a New York-based independent forecasting group reported that its weekly leading index fell to 129.4 in the week to 18 July 2008 from downwardly revised 131.1 in the previous week. The decline recorded in the index is the lowest after it reported 129.0 in the week to 24 October, 2003, which was due to higher interest rates and jobless claims and weaker housing sector.

US economy grows at a 1.9 % annual rate in the 2Q

According to advance estimates released by the Bureau of Economic Analysis on 31 July 2008, the US real gross domestic product (GDP) increased at an annual rate of 1.9% in the second quarter of 2008, compared to a rise of 0.9% in the first quarter. The increase in real GDP growth in the second quarter was largely due to decrease in imports, a rise in exports, a smaller decrease in residential fixed investment, and an acceleration in personal consumption expenditures PCE.

UK service sector shrinks for third month in July

The Chartered Institute of Purchasing and Supply/Markit (CIPS) reported that its headline activity index for the sector rose to 47.4 in July from a sevenyear low of 47.1 in June. The agency mentioned that the figure was the third consecutive reading below the 50 mark, which divides expansion from contraction.

Survey says Britons now 15% worse off than 2003

According to Ernst & Young's Annual Discretionary Income Study released on 04 July 2008, the average British household is now 15% worse than it was five years ago. According to the study, after tax contributions and paying monthly household bills, the average British family is left with less than 20% of its gross income, compared to 28% in 2003.

Saudi inflation hits 30-year high on food, rent

According to the Ministry of Ec onomy and Pl anning ' s Cent r a l Department of Statistics, Saudi Arabia's annual inflation rose 10.6% in June 2008 to 30-year high, primarily due to increase in food and housing costs. The cost of living index for the largest Arab economy rose to 115.5 points on 30 June 2008 from 115 points in May and 104.4 points on 30 June 2007.

Strong consumer spending in UAE

According to a report released by the Abu Dhabi Department of Planning and Economy on 29 June 2008, consumer spending in the second-largest Arab economy jumped 17.7% to Dirhams 319.87 billion (£43.7 billion) in 2007, more than double its level five years earlier. The department mentioned that the per capita spending in the country of 4.1 million people is about $27 a day, approximately eight times higher than average daily spending in the rest of the Arab world. The high consumer spending accounts for almost half of the UAE's GDP.

Unemployment edged up in Canada in June

According to a data released by Statistics Canada on 11 July 2008, Canadian unemployment level has increased to 6.2% in June from 6.1% in May, while the net change in employment has declined by 5,000 per sons. On year-over-year basis, employment in Canada has increased by 1.7% creating 290,000 new jobs.