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Canadian dollar falls after highest job losses since recession 4 years ago

Canadian Dollar Tumbles After Unexpected March Employment Loss

By Ari Altstedter

The Canadian dollar fell in its biggest decline in nine months against its U.S. peer after the nation unexpectedly lost jobs last month by the most since the last recession four years ago.

The currency declined against 13 of its 16 major peers as Canada had 54,500 fewer jobs in March, compared with the 6,500 gain predicted in the median estimate of a Bloomberg survey of 24 economists. The nation’s jobless rate increased to 7.2 percent from 7 percent. The U.S. added 88,000 jobs in March, versus estimates of a 190,000 gain. The Bank of Canada’s March 6 policy statement called for the economy to “pick up through 2013” on its way to 2 percent annual growth.

“Huge miss on both numbers, but particularly the Canadian number after many months of surprisingly strong employment data, we’ve finally seen some give back, so pretty swift reaction for the Canadian dollar,” said Blake Jespersen, managing director of foreign exchange at Bank of Montreal, by phone from Toronto. “There’s a lot more room for this to run, I think this is just the beginning of what could be a series of weaker employment numbers in Canada.”

The loonie, as the Canadian dollar is known for the image of the C$1 coin, fell 0.5 percent to C$1.0176 at 5 p.m. in Toronto. Earlier, it fell 1.1 percent to C$1.0236 per U.S. dollar, the largest drop since June 28. One loonie buys 98.27 U.S. cents.

Bonds Gain

Canada’s benchmark 10-year government bonds rose, with yields falling four basis points or 0.04 percentage point to 1.75 percent, touching the lowest level since Dec. 11. The 1.5 percent security maturing in June 2023 rose 36 cents to C$97.68.

Crude oil, the country’s biggest export, fell 0.3 percent to $93.02 per barrel in New York, after touching its lowest point since March 7. The Standard & Poor’s 500 Index of U.S. stocks fell 0.4 percent.

Canada’s jobs figures brings the labor market more in line with other parts of the economy, where output growth slowed to a 0.6 percent annualized pace in the fourth quarter and inflation has lagged the central bank’s 2 percent target since May. Last month’s figures mean Canada posted a net loss of 25,700 jobs in the first three months of the year.

’Ugly Across’

“It was ugly across the board, there wasn’t one redeeming feature for the Canadian employment report,” said Mark Frey, chief market strategist at Cambridge Mercantile Group, a corporate currency broker, by phone from Victoria British Columbia. “When you look at the overall employment figures for Q1 in Canada, you’re seeing a pretty bleak outlook that has turned almost on a dime from the last five months of 2012.”

A separate report showed Canada recorded its 11th straight merchandise trade deficit in February, the longest streak in at least 25 years, with the shortfall unexpectedly widening as exports of metals declined.

The deficit of C$1.02 billion ($1 billion) followed a January figure that was revised to C$746 million from C$237 million, Statistics Canada said today in Ottawa. Economists surveyed by Bloomberg forecast the string would end with a C$100 million surplus, based on the median of 21 forecasts.

“Obviously disappointment on both sides of the border,” said David Tulk, chief macro strategist at Toronto-Dominion Bank (TD)’s TD Securities unit by phone from Toronto. “The labor market is sort of catching up to the wider economic backdrop that we’ve always argued is still quite subdued, so this helps a little bit.” ….

Read more » Bloomberg
http://www.bloomberg.com/news/2013-04-05/canadian-dollar-extends-loss-after-unexpected-march-jobs-decline.html

Clinton to give Pakistan diplomacy one more big push before they go off the rails altogether.

– Clinton to give Pakistan diplomacy one more big push

By Josh Rogin

Excerpt;

Secretary of State Hillary Clinton is leading a very high-level delegation to Pakistan later this week to try one more time to set U.S.-Pakistan relations back on track, before they go off the rails altogether. ….

….. Overall, the Obama administration wants Pakistan to know it can’t accept Americans being killed because of what’s happening inside Pakistan. But there aren’t expected to be any grand, new initiatives or new proposals to lift bilateral relations from what all sides agree is the lowest point in years.

“The U.S.-Pakistani relationship has been deteriorating all year, from the Raymond Davis case to the Osama bin Laden raid to the attack on the American Embassy in Kabul,” said Riedel. “And there’s really no evidence the bottom is in sight; it may be getting worse and worse.”

Read more » ForeignPolicy

Pakistan-U.S. security relationship at lowest point since 2001, officials say

By Karen DeYoung and Griff Witte

The security relationship between the United States and Pakistan has sunk to its lowest level since the two countries agreed to cooperate after the Sept. 11, 2001, attacks, endangering counterterrorism programs that depend on the partnership, according to U.S. and Pakistani officials.

Both sides say further deterioration is likely as Pakistan’s military leadership comes under unprecedented pressure from within its ranks to reduce ties with the United States. The army chief, Gen. Ashfaq Kayani, was jeered last month by fellow officers who demanded in a town-hall-style meeting that he explain why Pakistan supports U.S. policy.

Kayani “is fighting to survive,” said one U.S. official, speaking on the condition of anonymity because of current sensitivities. “His corps commanders are very strongly anti-U.S. right now, so he has to appease them.” …

Read more: The Washington Post

Move to C.I.A. Puts Petraeus in Conflict With Pakistan

By JANE PERLEZ and ERIC SCHMITT

ISLAMABAD, Pakistan — The appointment of Gen. David H. Petraeus as director of the Central Intelligence Agency puts him more squarely than ever in conflict with Pakistan, whose military leadership does not regard him as a friend and where he will now have direct control over the armed drone campaign that the Pakistani military says it wants stopped.

Pakistani and American officials said that General Petraeus’s selection could further inflame relations between the two nations, which are already at one of their lowest points, with recriminations over myriad issues aired publicly like never before.

The usually secretive leader of the Pakistani Army, Gen. Ashfaq Parvez Kayani, has made little secret of his distaste for General Petraeus, calling him a political general. General Petraeus has privately expressed outrage at what American officials say is the Pakistani main spy agency’s most blatant support yet for fighters based in Pakistan who are carrying out attacks against American troops in Afghanistan.

Officials on both sides say they expect the two nations’ relationship to become increasingly adversarial as they maneuver the endgame in Afghanistan, where Pakistan and the United States have deep — and conflicting — security interests.

Repairing the frayed ties between the C.I.A. and Pakistan’s primary spy agency, the Inter-Services Intelligence Directorate, will be difficult, American officials say. “In its current form, the relationship is almost unworkable,” said Dennis C. Blair, a former American director of national intelligence. “There has to be a major restructuring. The ISI jams the C.I.A. all it wants and pays no penalties.” ….

Read more : The New York Times

The Downfall of Political Islam

by Samir Yousif

Finally I would point out that political Islam has failed to provide a political model that can compete with other contemporary political models, such as the Chinese model, Western democracies, or even developing democracies such as India and the other Asian countries. That comes with no surprise, as religion, any religion, keeps itself centuries behind.

The theme of my argument is the following statement: Islam, as a religion, has nothing to offer to economic or political theory. This simple idea has serious consequences. Political Islam, when it runs the country, will ultimately fail. It has no appropriate agenda that provides solutions to real political or economic challenges such as underdevelopment, unemployment, inflation, recession, poverty, just to mention a few.

(I will not touch upon the most significant political-socioeconomic issue which is income inequalities, because Islam accepts a society composed of very rich classes living side by side with very poor classes- examples can be found from history or from today’s Muslim countries like Saudi Arabia, and Iran). While some Islamists continue to claim the existence of “Islamic economics,” they have failed in producing anything close to a simple theory of economics.

I believe that the main reason for the downfall of Muslim civilisation was the inherent social crisis: a society composed of few rich surrounded by the poor masses kept going by a strong religion. Social and political revolutions took place several times during the heyday of Muslim civilisation, as happened during the Umayyad Caliphate, the Abbasid Caliphate, in Muslim Spain, and the famous Zanj Rebellion during the year 869 in Basra. But historians have ignored such revolutions. Muslim economies have failed throughout history to solve the very basic problem: the wage equation. Unskilled and skilled workers were downgraded to the lowest classes in Muslim societies, and were paid the minimum. History has showed that under Islam the wealth of the country went mainly to the Calipha, feeding his palace, army, the royal family, and to the vested interest that the Calipha has chosen himself. The tax system was mainly imposed on the agricultural sector, what was known as the produce tax (Kharaj).

“Islamic economics” is a term used today to justify the significant income inequalities in such societies and to find religiously- accepted investment opportunities for the rich. …

Read more : http://www.document.no/2011/01/the-downfall-of-political-islam/