Toyota Motor Corp. President Akio Toyoda reacts during a news conference at a Toyota office in NagoyaItsuo Inouye
Stories Report on Business is following today :
Canada churns out 43,000 jobs
Employment in Canada now stands just 0.1 per cent below where it was at the height of the crisis in January, 2009. Statistics Canada said this morning the economy created 43,000 jobs last month and the unemployment rate dipped to 8.3 per cent - the lowest since September - from 8.4 per cent in December. While the gains were driven by part-time jobs, which increased by 41,500, full-time work still rose by some 1,400. Also of note is that it was the private sector that was hiring.
BMO Nesbitt Burns deputy chief economist Douglas Porter noted that employment is now basically back at the level of last January, when the recession was running at full tilt. True, January of 2009 saw the biggest single month erosion of jobs throughout the recession, so it's looking at a low base, but jobs continued to be lost even after that, he said. Part-time employment is now up by 1.8 per cent from that mark, and full-time work down just 0.5 per cent. All in all, Mr. Porter noted, this morning's report from Statistics Canada shows an "erratic recovery" in the labour market, but no doubt now that it is "grinding forward."
"One great month does not a boom make, but strong hiring by Canadian employers in January builds on a decent two-quarter trend that evinces a gradual recovery in the labour market," added CIBC World Markets chief economy Avery Shenfeld. Read the story
U.S. job losses narrow
The United States, in turn, lost 20,000 jobs, a worse showing than expected, while the unemployment rate fell to 9.7 per cent from 10 per cent. It's worth noting that while the reading was worse than expected, January saw the lowest number of monthly job cuts since the recession began, but for a surge last November. Given revisions, the recession has now killed 8.4 million American jobs, the most of any slump since the Second World War when calculated as a proportion of total employment. Read the story
Sovereign debt weighs on markets
European markets were stressed again today over issues related to the so-called PIIGS of Europe - Portugal, Italy, Ireland, Greece and Spain. The cost of insuring the sovereign debt of Greece, Spain and Portugal against default rose to fresh record highs. European stocks fell, the U.S. dollar rose and the euro weakened again, rippling through other markets. Copper, for example, fell to its lowest in several months.
Among the PIIGS, Spain's central bank said today the economy was still in recession in the fourth quarter. Spain's economy has now contracted for six quarters in a row, and its unemployment rate is near 20 per cent.
Portugal's parliament is voting today on a bill by opposition politicians that the minority government hopes to block because it would boost the country's deficit. The government of Portugal, whose markets have been slammed by its debt woes, has vowed to cut its deficit to below 3 per cent of gross domestic product by 2013. Markets are watching to see whether the government can win today's fight.
The prime minister of Greece, whose troubles have roiled markets the most, told reporters today that while the markets doubt the country's austerity plans, "we will credibly apply this program."
"The current downward spiral in markets stems from confidence, which makes the solution a difficult one," said Scotia Capital currency strategist Camilla Sutton. "The markets had given Greece and the other weaker EU members a window to bring their fiscal positions into line. It has failed to do so and [the euro]has been punished. The fear from here is sovereign contagion to Portugal and Spain. CDS levels (or bond yield spreads over Germany) have all moved significantly … and the markets are increasingly nervous about what path lies ahead for the euro zone and [euro] The choices are limited and complicated, but fiscal responsibility is at the heart, and that will prove difficult in the current economic environment."
Just as an aside, Barclays Capital has banned the use of the term PIIGS among its analysts. Bloomberg News said this morning it obtained a memo sent to research staff at Barclays PLC's securities unit advising staff not to use the acronym that has grown more popular as the debt troubles of those countries mount. "By denigrating a nation in the process of trying to describe a financial situation, it sort of puts the people in that country behind the eight ball," one money manager told the news agency.
Related : Europe's debt crisis threat to recovery
Toyota apologizes, no Prius recall
The chief of Toyota Motor Corp. apologized today for his company's safety problems, but he did not announced a Prius recall, as some had speculated he might. Akio Toyoda, who has said little since the auto maker's crisis began, first with sticky gas pedals on several popular models and then brake issues with the 2010 Prius hybrid, pleaded this morning that "Toyota cars are safe."
Mr. Toyoda told reporters that the company would announce what measures it would take to deal with the Prius when decisions were made. But Japan's Transport Minister Seiji Maehara said he had been told by his officials that Toyota would recall or fix the vehicles and that "Toyota's response came up short from the perspective of its customers," according to reports from Japan.
Analysts also noted that Toyota shareholders, who have seen in the range of $30-billion (U.S.) wiped out, also were entitled to answers. "Toyoda is responsible for explaining to shareholders since they have lost a significant part of their assets," Rakuten Investment Management president Kazutake Oshima told the Reuters news agency.
"He should have come out a week ago," Masaaki Sato, an author of books on the Japanese auto industry, told The Associated Press. "After all the foot dragging, he was pushed into a corner."
Toyota also announced it is also setting up a special quality-control committee.
Read
Toyota recalls, questions mount
Prius faithful keep on driving
Canada, U.S. strike 'Buy American' deal
Canada and the United States announced a settlement to the 'Buy American' dispute this morning. Canadian companies will now be exempted from provisions of the almost $800-billion (U.S.) American stimulus program, Trade Minister Peter Van Loan said. Today's agreement takes in 37 states, while in Canada, provinces and cities will allow American firms to bid on projects. Read the story
China-U.S. trade tensions rise
One is tempted, of course, to call it a game of chicken. But for the fact that the levies involved run to more than 105 per cent. China today slapped heft anti-dumping levies on imports of U.S. chicken products after an initial probe found they were being sold at low prices. The duties run from about 43 per cent up to 105.4 per cent. China began investigating American chicken product exports after the United States increased levies on Chinese tire exports, and trade tensions between Beijing and Washington have been rising.
Bombardier aircraft shipments slump
Bombardier Inc. said this morning its aerospace unit is still being hit by the global slump, and it projects a 15-per-cent decline in aircraft deliveries in its current 2010-2011 fiscal year. In the last fiscal year, deliveries fell about 13 per cent. "While indicators of market stabilization have started to emerge, we remain cautious as economic uncertainty still prevails," Bombardier Aerospace president Guy Hachey said in a statement. "We have taken significant steps to strengthen our operations and continue to invest significantly in future programs."
UBS Securities Canada analyst Fadi Chamoun said in a research note that "we believe [Bombardier's]investment in future programs coupled with the productivity initiatives undertaken over the course of the past few years buttresses it against aero uncertainty in [fiscal]2011 and positions it well for a recovery in aero demand."
From today's Report on Business
Super Bowl marketers are changing their game