Currency and equity markets were basically treading water on Friday after the monthly report on payrolls showed the economy shed an additional 663,000 jobs last month as the unemployment rate rose to 8.5%, the highest in 25 years.
Also, the Institute for Supply Management said its index for the service sector fell to 40.8 in March, the sixth straight monthly decline. The report gave pause to the idea that the rate of economic contraction was slowing.
There was further bad news on housing as well; delinquency rates on the least risky mortgages, which account more than doubled last year, the Office of the Comptroller of the Currency and Office of Thrift Supervision said today in a report. Seriously delinquent prime loans climbed to 2.4% of total loans by the end of 2008 from 1.11% in the first quarter, a situation which is likely to worsen as job losses grow.
Worse, the report also showed that mortgages modified in the first quarter fell delinquent 41% of the time after eight months, and second-quarter modified loans had a 46% default rate, the report said. Third-quarter trends “are worsening,” the agencies said.
In recent trade, the dollar was mixed but mostly higher. It was gaining 0.22% on the euro, 0.48% against the yen and 0.60% on Australia's currency as it fell 0.50% to cable.
The DOW and S&P were off 0.49% and 0.11% respectively while the NASDAQ gained 0.37%.
April crude was lower by 24 cents while gold was down another $10.80 as it fell below $900.