Euro Zone reports record joblessness and low inflation – ‘Wage growth is set to weaken from already low rates’
By DAVID JOLLY
1 March 2013 PARIS (The New York Times) — The unemployment rate in the euro zone edged up in January to another record, official data showed on Friday, as the ailing European economy continued to weigh on the job market. That, along with new data showing a decline in inflation in the euro zone, could prompt the European Central Bank to take steps to stimulate the economy when its governing council meets on Thursday, analysts said. Unemployment in the 17-nation euro zone climbed to 11.9 percent in January from 11.8 percent the previous month, according to Eurostat, the statistical office of the European Union. For the 27 nations of the European Union, the jobless rate was 10.8 percent, up from 10.7 percent in December. All of the figures were seasonally adjusted. A separate Eurostat report showed price pressures easing in February. In the euro zone, the annual inflation rate was 1.8 percent, down from 2 percent in January and below the central bank’s 2 percent target. The jobless data suggests “that wage growth is set to weaken from already low rates” and further depress consumer spending, which has already been hurt by government austerity measures, wrote Jennifer McKeown, an economist at Capital Economics in London, in a research note. […] But despite the glimmers of hope in German industry, there are few reasons to regard a recovery as imminent. Markit’s overall euro zone purchasing managers’ index was unchanged in February at 47.9, indicating continued contraction. [more]
