US employment numbers for January recorded their biggest contraction in 27 years. Nonfarm payroll employment fell sharply, down almost 600,000 in one month alone and the unemployment rate rose from 7.2 to 7.6%. Payroll employment has declined by 3.6 million there since December 2007; about one-half of this decline occurred in the past 3 months. In January, job losses were large and widespread. This monthly nonfarm payrolls report has long been the US dollar's top, market-moving economic indicator. This latest data certainly undermines the health of the world's largest economy and degrades the long-term fundamental position of its currency. The US dollar sagged significantly on this news. The NZ$ rose 2.5c from its Thursday close as is currently at NZ$1 = US0.5324. You can follow the exchange rate trends, and live rates, here >>> A turnaround in demand from the world's largest economy - which represents about one-quarter of global GDP - seems a long way off, and means that world trade will be in the contraction for some time yet. Overnight, the OECD said that its leading-indicator measures were declining sharply, and at their lowest levels since the 1970's. China and Russia appear to be the major economies who are suffering the sharpest declines.
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