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The dollar strengthened sharply against the euro, updating the maximum of 3 May, aided by statistics on the US labor market. The Labor Department reported the unemployment rate in the US in May, contrary to expectations, rose to 5.5% from 5.4% in April. The number of jobs in non-agricultural sectors of the economy increased by 280 thousand .. Analysts had expected the unemployment rate will remain at the April level of 5.4%, while the number of jobs will grow by 225 thousand. The ministry also revised its estimate of job growth in April to the downside - to 221 thousand. with previously reported 223 thousand. Wages, meanwhile, grew at a solid pace. Average hourly earnings of private sector employees increased by 8 cents, or 0.3%, to $ 24.96 in May. Economists expect that wage growth will be 0.2% in April. Compared with the previous year, hourly earnings rose by 2.3% in May, slightly better than the 2% annual rate in recent years. A report in May provides an initial assessment, and probably will be revised when the government will gather fresh data. But now the report states that employers continue to invest in new employees, despite coming out lately mixed economic data. A broad measure of unemployment, which includes Americans who are engaged in part-time or are not able to seek employment was unchanged in May at 10.8%. The average workweek also remained the same as last month, at 34.5 hours. The proportion of Americans who are unemployed or looking for work, remains historically weak. The level of participation in the labor force rose to 62.9% from 62.8%, becoming a sign of progress, but still close to the lowest level since the late 1970s.
The Canadian dollar rose against the US dollar, entrenched below CAD1.2500, which was associated with the publication of data on unemployment in Canada. As it became known, the unemployment rate in Canada in May, has held at the April level of 6.8%. Unemployment in the country at 6.8% retained the fourth consecutive month. Experts expect that figure will remain the same. The number of jobs in Canada increased last month by 58.9 thousand., After declining by 19.7 thousand. In April. Predicted an increase of 10 thousand. In comparison with May 2014 the number of employees increased by 192 thousand., Or 1.1%. Meanwhile, another report showed that labor productivity in Canada fell by 0.1% between January and March compared with the previous quarter. Traders had expected a decline of 0.2%. Unit labor costs increased by 1.2%, while hours worked declined by 0.2%.
The pound regained some previously lost ground against, but still shows a significant decrease. The main pressure on the currency had data on the US labor market. Also today, the British Chamber of Commerce lowered its growth forecast for the UK economy this year, citing weaker-than-expected rise in the first quarter. Business lobby expects the economy to expand by 2.3 percent this year, instead of 2.7 percent as previously forecast. However, the slowdown is expected to be temporary. The forecast in the medium term remains stable, the growth will be 2.6 percent in 2017 and the next. "While this slowdown will serve as a warning about the power of our economic recovery, we believe that the UK will ensure steady growth in the coming years," said John Longworth, director general of the British Chamber of Commerce.
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