Charting the Global Economy: U.S. Jobs Puts Bright Cap on Week
(Bloomberg) -- The U.S. unemployment rate fell more than expected in August, offering good news after troubling signs in Europe’s economy earlier in the week.
The fourth straight monthly improvement in the labor market included a 1.37 million gain in nonfarm payrolls, though the pace of job growth is moderating. The jobless rate dropped to 8.4%. There are still risks, with Congress in stalemate over another stimulus package and companies continuing to announce job cuts.
Here are some of the charts that appeared on Bloomberg this week, offering insight into the latest developments in the global economy:
Following signs of a downturn in previous weeks, the latest readings show activity stabilizing across most advanced economies, though still some way from pre-Covid levels, according to Bloomberg Economics. With activity at just two-thirds of pre-virus levels, the U.S. is the worst performing of the advanced economies BE is tracking.
The world is hurtling toward an unprecedented hunger crisis. As many as 132 million more people than previously projected could go hungry in 2020, and this year’s gain may be more than triple any increase this century.
The headline U.S. jobs numbers on Friday sent the dollar and Treasury yields higher. But behind that was was more troubling figure: the number of permanent job losers rose by more than half a million to 3.41 million, the highest level since 2013. It points to the ongoing business closures, bankruptcies and investment cuts across the country.
Hunger is surging in the heart of the U.S. breadbasket, showing just how dire the problem has become during the pandemic.
There’s a tax trap looming for Europe’s cross-border commuters and the companies that depend on them, if working from home becomes permanent following the pandemic.
The U.K. economy will struggle to avoid scarring from the current downturn, though the hit could be smaller than after previous recessions, according to Bloomberg Economics.
The blow from Covid-19 has put Chinese gross domestic product on track to grow just 2% in 2020, based on Bloomberg Economics’ projections. This is strong by global comparison, but the slowest on record since China began reforms in the late 1970s. Expect more slowdown in the decades ahead.
While many Asian central banks have spent the year slashing interest rates and boosting money supply in response to the economic havoc wrought by the pandemic, deflation fears still managed to crop up across parts of the region.
The single biggest risk to South Africa’s economic outlook remains the availability of electricity, according to Bloomberg Economics. It’s a binding constraint that continues to hold back productivity and investment growth. Without it, the country’s growth potential will remain stuck around 1%, even if progress is made in other areas.
Job losses in the wake of the coronavirus pandemic in the United Arab Emirates are getting worse even as much of the rest of the Gulf’s second-biggest economy is starting to heal.
©2020 Bloomberg L.P.