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Eurozone unemployment rises to record 11.6 per cent

Unemployment in the 17-country Eurozone rose to a record 11.6 per cent in September, in another grim development for a region that is struggling to get to grips with a three-year debt crisis.

twitter-logo Associated Press   Brussels     Last Updated: October 31, 2012  | 17:17 IST

Unemployment in the 17-country Eurozone rose to a record 11.6 per cent in September, in another grim development for a region that is struggling to get to grips with a three-year debt crisis.

The rate reported by EU's statistics office Eurostat is up from an upwardly-revised 11.5 per cent in August. In total, 18.49 million people were out of work in the Eurozone in September, up 146,000 on the previous month.

While the Eurozone's unemployment rate has been rising steadily for the past year as its economy struggled, the United States has seen its equivalent rate fall to 7.8 per cent. The latest US figures are due this Friday.

Five countries in the Eurozone are already in recession - Greece, Spain, Italy, Portugal, and Cyprus.

The region as a whole is expected to be confirmed to be in recession when the first estimate of Eurozone economic activity in the third quarter is published mid-November - a recession is officially confirmed after two consecutive quarters of negative growth.

Spain was in the ignominious position of having the highest unemployment rate in the Eurozone, at 25.8 per cent. However, Greece was not far behind at 25.1 per cent, though its figure relates to July.

Both countries, which are at the epicenter of Europe's three-year debt crisis, have youth unemployment above 50 per cent.

The lowest unemployment rate in the Eurozone was Austria's 4.4 per cent. Germany, Europe's biggest economy, has a jobless rate of only 5.4 per cent.

Separately, Eurostat reported that inflation in the Eurozone fell modestly to 2.5 per cent in the year to October, from the previous month's 2.6 per cent. Inflation is still above the European Central Bank's target of keeping price rises just below 2 per cent.

Above-target inflation has not prevented the ECB cutting its key interest rate to a record low of 0.75 per cent, but few economists think the bank will lower borrowing costs at next Thursday's monthly meeting.

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