New high for eurozone joblessness, inflation up

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New high for eurozone joblessness, inflation up

New high for eurozone joblessness, inflation up
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Unemployment in the eurozone reached a record high in May.

But the latest figures show vast differences in jobless rates around the region: Austria and Germany have the lowest – at 4.7 percent and 5.3 percent respectively, while Spain and Greece are worst at just under 27 percent, though the Greek total could be higher by now as the latest available figures are from March.

Illustrating the weakness of the recession-battered economy 19.2 million people are without a job.

Total unemployment stood at a record 12.2 percent, up from 11.3 percent in May of last year.

Over three and a half million of the eurozone’s jobless are young people – those under 25 – and there were 60,000 more of them in May than there were a year earlier.

European Union leaders just agreed special programmes to help them, but the six billion-euro plan, over two years, is unlikely to be enough to tackle youth unemployment that is near 60 percent in Greece and Spain.

Inflation up for 2nd month in a row

At the same time it was announced inflation in the 17-nation eurozone rose due to volatile costs of energy and food.

Consumer prices in June increased to 1.6 percent from a year earlier.

Core inflation, which strips out food and energy prices, was stable at 1.2 percent, which means the European Central Bank can keep interest rates low for now to stimulate the weak economy.

June’s inflation reading was the second upward move from a three-year low of 1.2 percent in April, although it remains beneath the ECB’s target of just under 2.0 percent.

“The big story remains the huge divergence between unemployment rates across countries,” said Jonathan Loynes, chief European economist at Capital Economics.

“There is nothing to suggest that the eurozone economy does not need additional policy support, though the ECB looks unlikely to oblige this week,” he added.

Jobless ups and downs

Compared with a year ago, the unemployment rate increased in 17 EU member states and fell in 10 of them. The largest increases were in Cyprus (11.4 percent to 16.3 percent), Greece (22.2. percent to 26.8 percent between March 2012 and March 2013) and Slovenia (8.6 percent to 11.2 percent).

The largest decreases were in Latvia (15.5 percent to 12.4 percent between the first quarters of 2012 and 2013), Estonia (10.0 percent to 8.3 percent between April 2012 and April 2013) and Lithuania (13.3 percent to 11.7 percent).

In May 2013, the jobless rate in the United States was 7.6 percent, up from 7.5 percent in the previous month. It had been 8.2 percent in May 2012.

With Reuters