FT article

- Adds Comments From Labor Agency Head

- SA Unemployment: +9k (pan-German), +7k (West), +2k (East)

FRANKFURT (MNI) – German unemployment rose slightly more than
generally expected in August but not enough to lift the jobless rate
from July’s 21-year low of 6.8%, the Federal Labour Office reported on
Thursday.

The number of unemployed rose by 9,000 in August to 2.901 million
from an upwardly revised 2.892 million in July. Most analysts had
expected a monthly increase of at most 8,000.

In unadjusted terms, unemployment climbed 29,000 to 2.905 million
but the jobless rate was unchanged at 6.8%.

Job vacancies fell by 4,000, adding to July’s 7,000 decline and
suggesting that demand may be peaking. Payroll jobs data, which lag by
one month, rose by 16,000 in July after +25,000 in June.

Speaking to journalists, the Labor Agency’s Frank-Juergen Weise
acknowledged the unemployment numbers showed that the positive
developments in the first half of the year were weakening, but he denied
that a full trend reversal in labor market was looming.

“If we add everything together, then we should expect sideways
movement,” Weise said. “There will not be improvement to the degree that
we saw in the first half of the year.”

Weise said the Labor Agency had expected unemployment of between
2.8-2.9 million through this year and noted that August’s figures put
the total jobless number in line with that estimate.

Employment as measured in International Labour Office terms stood
at 41.620 million in July, according to data released earlier today.

With the jobless level up for the fifth time in six months, labour
market trends reflect the slowdown in economic growth and employers’
growing uncertainty about future prospects.

As the economic environment continues to deteriorate, car maker
Opel earlier this week announced that it would cut working hours of
thousands of workers in response to sluggish demand. The move recalls
the widespread use of public subsidies for short-time work during the
2008-09 crisis to avoid job losses under the government’s Kurzarbeit
program.

While the program was very successful and allowed companies to
respond more quickly when demand recovered, Opel’s move is unlikely to
be followed widely, as a sharp increase in unemployment in the months
ahead remains unlikely.

August’s flash PMI for Germany, released on August 23, showed a
fifth successive monthly fall in manufacturing employment, while service
providers added to staff, giving a marginal overall expansion of the
private sector workforce.

The European Commission sentiment index, released on July 30,
showed employment expectations easing across all sectors apart from
retail trade. However, the index levels remained well above the
historical averages throughout the economy.

Many German employers are now in wait-and-see mode, neither hiring
nor downsizing until Europe’s economic locomotive begins to pick up
steam again, an MNI survey of recruitment professionals indicated.

Survey participants cited a combination of peaking demand for new
workers and supply-side shortages that have slowed the pace of hiring,
as many regions are nearing full employment and scraping the bottom of
the barrel for quality applicants.

The research arm of the German labor agency IAB in late March
forecast 2012 unemployment to average at 2.84 million, 130,000 fewer
than in 2011, assuming GDP growth of 1.1%. IAB was not in the position
to offer insight into how recent weak data may affect its new forecasts
due to be released in September.

– Frankfurt bureau: +49 69 720 142, email: frankfurt@mni-news.com —

[TOPICS: M$G$$$,MAGDS$,M$X$$$,M$XDS$,MT$$$$]

So close… but yet so far. The ‘basic  scenario’ has been agreed but differences remain over pensions and ‘special salaries’

PM Samaris , Pasok’s Venizelos and Dem Left’s Kouvelis  are expected to meet again on Monday to agree the Eur 11.5 bln austerity package  ahead of a return of the ‘Troika’ on Wednesday

More… ekathimerini

LONDON (MNI) – Foreign investors were net buyers of gilts in July,
ending a five-month run in which they were net sellers, according to new
data from the Bank of England.

The BOE’s Bankstats figures show non-residents increased their gilt
holdings by stg9.358 billion in July after having reduced their holdings
by a total of stg16.771 billion in the previous five months combined.

The data also show that foreign investors reduced their holdings of
UK Treasury Bills, cutting their exposure by stg409 million after having
increased it by stg1.508 billion in June.

Banks’ holdings of high quality sterling liquid assets (gilts,
treasury bills, and deposits at the BOE) rose to stg368 billion or 9.9%
of their sterling assets in July, up from the stg357 billion or 9.6% of
sterling assets held in June.

Seperate data from the BOE showed lending rates rising and deposit
rates falling, with bank margins widening.

The rate paid on households’ outstanding time deposits fell by 2bps
to 2.85% in July although the rate for households’ new time deposits
increased by 1bp to 3.11%. The lending rate on secured loans rose to
3.37% from 3.35% in June, and held steady at 3.82% for secured new
business loans.

-London newsroom: 4420 7862 7491 e-mail: wwilkes@marketnews.com

[TOPICS: M$B$$$,M$$BE$]

LONDON (MNI) – Mortgage approvals rebounded in July after their
slump in June, which had been due to the exceptionally wet weather and
the extended Jubilee weekend.

Bank of England data showed mortgage approvals rose to 47,312 in
July from 44,124 in June, but this was still below the May outturn of
50,663 and shows approvals still running at low levels by historic
standards. Consumers appetite for unsecured credit is weak, and the data
showed a net July consumer credit repayment of Stg220 million.

Student loans were excluded from the consumer credit figures in
July, with the estimated Stg47 billion stock of student loans now
removed. As the student loans have been removed from the entire data
series, there is no obvious reason why this change would have fed
through to the negative monthly change in consumer credit in July.

The BOE figures showed broad money, M4, continuing to contract on
the year, rising 0.5% on the month in July but falling 4.6% on a year
ago.

M4 ex-IOFCs, which excludes economically irrelevant intra-financial
sector transactions, rose 1.0% on the month and was up 5.0% on a one
quarter/three month annualised basis and up 3.9% on a four quarter/12
month basis, suggesting the underlying pace of money growth is far more
robust than the headline M4 data suggest.

-London newsroom: +44 207 862 7491 email: drobinson@marketnews.com

[TOPICS: M$B$$$,M$$BE$,MABDS$]

Just above a Reuters poll of 47k. Mortgage lending rose to +£1.1bln  after -£0.2bln in June which was the biggest rise since January

 Consumer credit  fell – £0.2bln from +£0.1 bln in June, well below expectations of +£0.5 bln and the biggest fall since February

M$ money supply grew +0.5% m/m, -4.6% y/y

FRANKFURT (MNI) – Germany’s economy minister Philip Roesler on
Thursday affirmed his controversial view that a Greek-exit from the
Eurozone has become manageable.

“I stick by that, because with EFSF, the ESM and the fiscal
compact we have brought wide-ranging measures under way that contribute
to the protection of the Eurozone,” Roesler told Germany’s Zeit Online.

Roesler stressed that Greece must “meet promised reforms” and that
the German government will decide on further aid to Greece on the basis
of the upcoming Troika report.

The German minister said that is key for the Eurozone to reduce
excessive debt and to strengthen competitiveness and growth. “I am
convinced, that the euro can become the most stable currency world-wide,
he said.

–Frankfurt newsroom, +49-69-720-142; jtreeck@mni-news.com

[TOPICS: M$$EC$,M$X$$$,M$$CR$,MGX$$$,M$G$$$]

We sit at 1.2550 in the usual crap European trade.

REALLY stretching my patience now!!!

So what’ll we see breached first, 1.2500 or 1.2600?

Reason/s for choice always useful but ofcourse not obligatory.

GERMANY DATA: Jul machine orders -2% y/y; Jun -1%; May -6%: VDMA
–Jul domestic machine orders -18%; foreign orders +8%
–May-Jul total orders +2%; domestic 0%; foreign +6%
–See MNI Mainwire for details

Bids now building in the 1.5825/35 bracket are mopping up any selling  and the earlier mentioned possible buy stops up through 1.5855 are now evident, keeping the pair tightly rangebound for the time being ahead of the lending and money supply data due out in 25 mins time.

GBP/USD’s around 1.5837

Pretty much in line with Reuter’s median forecast of +8,000.

Unemployment rate 6.8%, unchanged from July and as expected.

Labour office says labour market is increasingly weaker due to slower German economic growth.  Sounds about right.

- SA Unemployment: +9k (pan-German), +7k (West), +2k (East)

FRANKFURT (MNI) – German unemployment rose slightly more than
generally expected in August but not enough to lift the jobless rate
from July’s 21-year low of 6.8%, the Federal Labour Office reported on
Thursday.

The number of unemployed rose by 9,000 in August to 2.901 million
from an upwardly revised 2.892 million in July. Most analysts had
expected a monthly increase of at most 8,000.

In unadjusted terms, unemployment climbed 29,000 to 2.905 million
but the jobless rate was unchanged at 6.8%.

Job vacancies fell by 4,000, adding to July’s 7,000 decline and
suggesting that demand may be peaking. Payroll jobs data, which lag by
one month, rose by 16,000 in July after +25,000 in June.

Employment as measured in International Labour Office terms stood
at 41.620 million in July, according to data released earlier today.

With the jobless level up for the fifth time in six months, labour
market trends reflect the slowdown in economic growth and employers’
growing uncertainty about future prospects.

As the economic environment continues to deteriorate, car maker
Opel earlier this week announced that it would cut working hours of
thousands of workers in response to sluggish demand. The move recalls
the widespread use of public subsidies for short-time work during the
2008-09 crisis to avoid job losses under the government’s Kurzarbeit
program.

While the program was very successful and allowed companies to
respond more quickly when demand recovered, Opel’s move is unlikely to
be followed widely, as a sharp increase in unemployment in the months
ahead remains unlikely.

August’s flash PMI for Germany, released on August 23, showed a
fifth successive monthly fall in manufacturing employment, while service
providers added to staff, giving a marginal overall expansion of the
private sector workforce.

The European Commission sentiment index, released on July 30,
showed employment expectations easing across all sectors apart from
retail trade. However, the index levels remained well above the
historical averages throughout the economy.

Many German employers are now in wait-and-see mode, neither hiring
nor downsizing until Europe’s economic locomotive begins to pick up
steam again, an MNI survey of recruitment professionals indicated.

Survey participants cited a combination of peaking demand for new
workers and supply-side shortages that have slowed the pace of hiring,
as many regions are nearing full employment and scraping the bottom of
the barrel for quality applicants.

The research arm of the German labor agency IAB in late March
forecast 2012 unemployment to average at 2.84 million, 130,000 fewer
than in 2011, assuming GDP growth of 1.1%. IAB was not in the position
to offer insight into how recent weak data may affect its new forecasts
due to be released in September.

– Frankfurt bureau: +49 69 720 142, email: frankfurt@mni-news.com —

[TOPICS: M$G$$$,MAGDS$,M$X$$$,M$XDS$,MT$$$$]

GERMANY DATA: Germany August sa unemployment +9k m/m;
– MNI median forecast +8k for Aug unemployment
– Aug sa unemployment rate 6.8%; med fcst 6.8%; Jul 6.8%
– Aug sa unemployment 2.901 mln; Jul 2.892 mln
– Aug nsa unemployment rate 6.8%; Jul 6.8%
– Aug nsa unemployment 2.905 mln; Jul 2.876 mln

Traders report some interest to sell building now in the low 1.0340′s after weaker o/n data and the Iron Ore/China stories continue to do the rounds.

There’s a lot of bids however to plough through ahead of the 200 day MA at 1.0311 and the 1.0300 barrier, and the overall bid tone is still intact barring a break down through the 1.0270 area.

Offers as mentioned start from the 1.0340′s and trail up to the 1.0400 barrier from a myriad of names

AUD’s currently sitting around 1.0338

PM speaking with party members in Athens

• Last chance to avert chaos, return to drachma
• Beginning to change the image of Greece
• Growth recovery depends on staying in euro
• Pursuing state asset sales, structural reforms
• Close to finalising EU11.5 bln budget package
• Budget cuts are painful, unavoidable
• EU11.5 bln package is the last such package
• Greek to get tranche if proves sticking to pledge
• Need to step up pace of state asset sales
• Tax evasion, red tape must be tackled for growth
• Europe can’t allow Greece to be achilles heel

Bloomberg reporting.

Auctions 5 and 10 year BTPs

Results due around 09:10 GMT.

Here’s what Credit Agricole thinks.

PARIS (MNI) – The exit of a country from the Eurozone would
endanger the entire currency bloc via an effect of “negative contagion”,
French Finance Minister Pierre Moscovici warned in a newspaper interview
published Thursday.

“We must not minimize the significant shock that Greece’s exit from
the euro would represent,” the minister told the business daily Les
Echos. “We wish that it remain in the Eurozone, provided it makes the
necessary efforts.”

Asked about Berlin’s reluctance to accord additional aid to Greece,
Moscovici replied that he and his German counterpart Wolfgang Schaeuble
had created a working group to define “perfectly common positions” on
policy toward Greece and Spain “but also on all issues linked to the
Eurozone crisis: a banking union, the future of the euro, growth and
competitiveness.”

The first priority is to resolve the problems of Greece, Spain and
Cyprus, he said. Then there are ways to improve the economic governance
of the Eurozone without changing its treaties, for example on “banking
supervision but also fiscal and social harmonization.”

Over the longer term, France is ready to go further in the
construction of Europe – “under the condition that with each stage of
integration there is a corresponding dimension of solidarity,” Moscovici
said. “That is why we will not abandon the idea, over time, of a
mutualization of public debts.”

Hailing the evolution of the “doctrine” of the European Central
Bank, the minister noted that President Mario Draghi said was ready to
intervene in bond markets as soon as member states seek assistance.

Thus governments must prepare in parallel the mechanisms for
financial assistance “the sooner the better,” Moscovici said. “But there
is still some political hesitation to overcome.”

Turning to the preparation of the government’s budget for next
year, to be presented in late September, the minister underscored the
necessity to bring the public deficit into line with the Maastricht
ceiling of 3% of GDP.

“I know how the markets function,” he said. “A relaxation of the
commitments to the European Union would be perceived a lack of shared
discipline costly in terms of interest rates.”

The budget will include measures to strengthen the competitiveness
of the economy while aiming for “stability” in the taxation of business
investment, he said, pledging that productive capital would not be
included in the base of the wealth tax.

The new 75% tax bracket for annual incomes over E1 million will be
applied in an “intelligent” way so as not to discourage economic
activity or trigger a exodus of business executives and managers, he
said.

–Paris newsroom +331 4271 5540; email: ssandelius@mni-news.com.

[TOPICS: MFFBU$,M$F$$$,M$X$$$,MGX$$$,M$G$$$,M$Y$$$,M$S$$$,M$$CR$]

Happy Dayz 

Above forecasts of 2.2% and reflecting higher fuel prices according to the INE