Swiss Unemployment Rate (ILO-based) behind Iceland, Germany and Czech Republic on position 4: All Four Countries Are Currency Manipulators

Summary:
With 4.8%, the Swiss unemployment rate based on the ILO concept is higher than the rates in Iceland (2.6%), Czech Republic (4.0%) and Germany (4.1%), but lower than the ones of the remaining 25 countries in the data provided by Swiss Statistics. As for youth unemployment, the Swiss are on position three with a rate of 11%, this is half the rate of the Eurozone, or a fourth of the rate in Spain or Greece. All Four Countries Are Currency Manipulators Interestingly three of the countries with low unemployment support their already strong economy with FX interventions. These are Switzerland, the Czech Republic and Iceland, while Germany does these FX interventions implicitly through the mechanism called Target2. Capital flows out of Germany through the Euro System (aka Target2). With this system, Germany prevents the appreciation of its currency because most of its current account surplus feeds the countries in the periphery. Without these outflows the currency – i..e. the German Euro –  would appreciate. Hence all four low unemployment countries are currency manipulators. Unemployment Rate according ILO in comparison Country Unemployment Rate Q3 2015 (in %) Unemployment Rate Q3 2016 (in %) Youth Unemployment Rate (15-24) Q3/2016 (in %) Switzerland 4.9 4.8 11.0 Eurozone 10.3 9.6 20.0 EU-28 8.

Topics:
George Dorgan considers the following as important: Featured, newslettersent, Swiss Macro, Switzerland Unemployment Rate

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