67 years ago Pakistan gained independence from British rule. At the time, the country found itself dependent on agriculture and were economically poor. In the first fifty years, Pakistan picked itself up, but nonetheless Pakistan still has a long way to go. War, lack of social stability, in-house political clashes, and lack of population control, has set the country back in terms of growth and development.
The Bureau of Labor Statistics reported stable regional and state unemployment rates in July that indicated a growing divergence between states and counties. The unemployment rate remained at 6.2% across states, down 110 basis points from a year ago.
Amid light new, the US dollar is slightly firmer against most of the major currencies, except sterling. Carney’s comments over the weekend, suggesting that the BOE will not necessarily wait for wages to rise before hiking rates, helped lift sterling after a six-week decline.
European stocks began the weak with a strong rally in Monday morning trading on news that Ukraine and Russia governments have begun high-level talks.
By now everyone is noticing that most nations are coming out of the financial crisis which began in 2008, even if it still means supplying large sums of money for the economy. However, some of the processes being used to bring nations out of this stump are coming under question (such as Bush’s and Obama’s ridiculous stimuluses), especially when it comes to the European Central Bank (ECB). As many people know, banks are the driving force of an economy.
Asian stocks post one of their best weeks in months on strong earnings and bets that Central Banks, particularly in China, will loosen monetary policies. On Friday, the Shanghai Shenzen CSI 300 Index added over 1% in trading near closing as the Hang Seng posted gains of 0.6%. The Nikkei was flat on mixed trading, although up for the week.
The capital markets are subdued. European markets have been thinned by the Assumption Day holiday. The US dollar is a bit softer against most of the major currencies, except the Japanese yen. Equity and bond markets are mostly firmer as well.
For most nations, when imports begins to decline, the amount of exports usually follows suit since it is difficult to continue sending items when there may be nothing with which to make them. However, China is changing this common perception as their exports are continually rising, and have been for the last several months, with a total increase 5.5% in June alone. This leaves China receiving a number of mixed signals as it appears their economy is beginning to improve, but that the middle class, which tends to spur the economy the most, is stalling.
The euro zone economy stagnated in Q2, as the rest of the region offset the unexpected 0.2% contraction in the German economy. The implied yield of the German bund future dipped below 1.0%, though the yield in the cash market held in slightly better. The euro itself, did not make a new lows. Indeed, last week’s low for the euro (~$1.3333) remains intact.
Germany’s economy shrank for the first time since 2012 in the second quarter of this year, according to the German Federal Statistics Office. The German GDP fell 0.2% after rising 0.7% in the first quarter, below analysts’ expectations. The eurozone’s largest economy previously saw 0.8% growth in the first quarter, which analysts had expected to be threatened by the Ukraine crisis. Last week, European Central Bank President Mario Draghi admitted that the Ukrainian conflict posed a threat to the eurozone economy.
