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Eurozone unemployment falls for the third month in a row but remains a problem

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Eurozone unemployment falls for the third month in a row but remains a problem

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Unemployment across the eurozone fell in January for the third month in a row while consumer prices fell by less than expected in February. Taken together analysts say it indicates that the risks of economic stagnation and deflation are easing off slightly.

Unemployment fell to 11.2 percent across the 19-member zone and is now at its lowest level since 2012.

A total of 18 million people were out of work in January, 140,000 less than the month before, although unemployment levels still vary widely across the eurozone.

Theoretically the falling jobless figures should provide a boost to consumers in terms of greater purchasing power, which is being given an extra push from falling prices, or deflation.

But ironically it is falling prices that worry economists, since if they continue to fall people tend to stop buying in anticipation that they will fall further. Such a scenario can have a negative effect on economic growth.