Subprime problem curbs job rate in U.S

Beijing News.Net
Saturday 25th August, 2007

In the U.S, subprime-battered mortgage lenders are shutting down and fewer homes are being built.

The slowing U.S economy is now hitting the job market, and economists say it is only a matter of time before unemployment moves up on the scale.

Economists are noting that growth is at the 2 per cent mark, which is not strong enough to keep the unemployment rate from rising.

Employment will remain the economic linchpin in the United States while jobs mean pay cheques, pay cheques mean spending, and consumer spending accounts for more than two-thirds of the U.S economy.

Meanwhile, Wall Street is heading for another volatile week, with a possible reprieve from downward direction if the calm brought on by the Federal Reserve's surprise cut in its discount rate lasts.

The coming week will also feature a raft of economic indicators, including July existing home sales and preliminary figures on second-quarter gross domestic product, which should shed more light on the economy's health.

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