Eurozone jobless queues lengthen

Unemployment across the nations that share the euro has risen again to its highest level in more than two years, as more firms laid off staff.

The eurozone unemployment rate totalled 8.2% in January, according to the latest official European Union data.

The figures is up from a revised 8.1% in December and above the 7.3% figure in January 2008, said the EU.

Meanwhile, annualised inflation in the 16-nation area fell to its lowest in nearly a decade in January, to 1.1%.

It is down from 1.6% in the year to December.

According to official figures, the eurozone has been in recession since September of last year.

The latest unemployment and inflation figures will increase the pressure on the European Central Bank (ECB) to cut eurozone interest rates further, in an effort to bolster the economy and bring inflation closer to its 2% target.

In January, the ECB trimmed rates by half a percentage point to 2%, its fourth reduction since September, when rates stood at 4.25%.

“January’s rise in unemployment and further fall in core inflation support our view that ECB interest rates have much further to fall,” said Jennifer McKeown, an analyst at Capital Economics.

“The downturn in the labour market, and indeed the wider economy, points to a further fall in core inflation in the coming months.”

Unemployment among Eurozone nations is highest in Spain, at 14.8%, and lowest in the Netherlands, at 2.8%.


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