Unemployment Declines in Europe

We finally get some positive numbers form Europe as unemployment rate declines.

The unemployment trend seems right

The unemployment reports from Italy and the Eurozone are out and they were positive. This is one of the few times we have seen positive economic data from Europe recently because the economy has softened considerably in the Eurozone and, as Sentix analysts commented on Monday, it might fall into stagnation soon because it is pretty close.

The unemployment rate in Italy ticked lower to 10.5% as expected, from 10.6% which is good, although it still remains too high. The unemployment rate in the Eurozone lost two points, declining to 7.9%. The previous month was revised lower as well to 8.0% from 8.1% previously. So, unemployment/employment is heading towards the right direction in Europe.

Yesterday we heard an official from the European Central Bank (ECB) comment on employment. He said that as unemployment declines in Europe, wages will increase since employers and that will drive inflation higher as well.

Well, the unemployment is falling but we are yet to see wage pressure. Inflation fell to 1.6% last week, from 2.0% previously, so it is going in the other direction. Although, let’s wait a few more months to see if his predictions materialize. For now though, the Eurozone economy seems too weak to make a sudden turnaround.

ABOUT THE AUTHOR See More
Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.

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