US economy sheds another 467,000 jobs

The US economy shed another 467,000 jobs last month, signalling aggressive government stimulus measures are failing to unshackle the labour force from the grips of the recession, official figures showed on Thursday.

The result was worse than economists predicted and pushed the unemployment rate from 9.4 per cent to 9.5 per cent, slightly better than expected but still a 26-year high. Thursday’s figure shows further erosion from the previous month’s decline of a revised 322,000 drop and knocked wind from the notion that the pace of job losses might be slowing.

Read moreUS economy sheds another 467,000 jobs

UK: Economy shrinks at fastest rate for 50 years

The UK economy shrank by 2.4 per cent in the first quarter at the fastest rate in more than 50 years and far worse than expected, according to official figures today.

Revised figures from the Office for National Statistics (ONS) showed that, between January and March, the economy contracted by its fastest pace since 1958. The ONS revised down its initial estimate, showing a contraction of 1.9 per cent.

Analysts had predicted that the revised numbers would show a 2.1 per cent fall in GDP.

Today’s shock data is in part due to a change in methodology in the way that the ONS calculates construction and services output, but will do nothing to boost Alistair Darling’s hopes of a recovery by the end of the year.

Construction output was revised down from -2.4 per cent to -6.9 per cent in the first quarter, but there was also a bigger than expected drop in output from the services sector, that accounts for more than two thirds of the economy, which was revised down from 1.2 per cent to 1.6 per cent.

Industrial output was revised up slightly to -5.1 per cent, from the initial estimate of -5.3 per cent.

Read moreUK: Economy shrinks at fastest rate for 50 years

Britain dropped plans for compulsory ID cards

id-card
File photo showing Home Secretary Jacqui Smith holding a sample identity card at a news conference in London September 25, 2008. (REUTERS)

LONDON (Reuters) – Britain said on Tuesday it was dropping plans to bring in compulsory biometric identity cards for airport workers and that the multi-billion pound scheme would remain voluntary for all Britons.

Home Secretary Alan Johnson said the government was going ahead with the introduction of the 30 pound cards, which contain personal details, fingerprints and a facial image, but ruled out making them compulsory.

Civil rights campaigners and opposition politicians have long opposed the project, saying it was unnecessary, expensive and an intrusion into private life.

Read moreBritain dropped plans for compulsory ID cards

Harvard professor: The probability of a real sterling crisis is around one in three, and the probability of major tax hikes and cuts in public spending is roughly one in one

Sterling Crisis Looms as U.K. Unraveling Points to Budget Cuts

gordon-brown

June 30 (Bloomberg) — The state of the U.K. economy fills British financial historian Niall Ferguson with foreboding.

“The probability of a real sterling crisis is around one in three, and the probability of major tax hikes and cuts in public spending is roughly one in one,” the Harvard University professor says.

Ferguson’s concern stems from the deterioration in the U.K.’s public finances, which prompted Standard & Poor’s to warn on May 21 that the country could lose its AAA debt rating. The firm estimated the cost of propping up Britain’s banks at 100 billion pounds ($166 billion) to 145 billion pounds and said government debts could double to almost 100 percent of gross domestic product by 2013.

Chancellor of the Exchequer Alistair Darling said on April 22 that this year’s government deficit would hit 12.4 percent of GDP. Alan Clarke, a London-based economist at BNP Paribas SA, expects it to reach 17 percent of GDP in 2010.

Read moreHarvard professor: The probability of a real sterling crisis is around one in three, and the probability of major tax hikes and cuts in public spending is roughly one in one