Euro-Area Unemployment Rate Unexpectedly Holds Steady at 11.7%

The euro-area jobless rate remained unchanged in December, adding to signs the currency bloc’s economy may be starting to emerge from a recession.

Unemployment in the 17-nation currency bloc held at 11.7 percent, the European Union’s statistics office in Luxembourg said today. The November rate was revised down to 11.7 percent from 11.8 percent reported earlier. Economists had forecast an increase to 11.9 percent, the median estimate in a Bloomberg News survey of 34 economists.

“Some months are stable, some months pick up a bit, but the direction of unemployment is very clearly upwards,” said Nick Kounis, head of macro research at ABN Amro Bank NV in Amsterdam. “The economy is most likely still shrinking or stagnating so there’s probably quite some upward correction in unemployment ahead, and we’re likely to climb way into the 12 percent area.”

The currency bloc’s economy will stagnate in the first three months of this year after contracting for a third successive quarter at the end of 2012, according to the median of 26 economists’ forecasts in a separate Bloomberg News survey. Still, euro-area economic confidence in January rose to the highest level since June, with employment expectations among manufacturers at a six-month high.

‘Nearly Stable’

Today’s jobless report showed that 18.7 million people were unemployed in the euro area in December, “nearly stable” from the previous month. The data also showed that youth unemployment is at 24 percent, with Spain’s rate more than double that, at 55.6 percent.

At 26.1 percent, Spain also had the highest overall jobless rate in the currency bloc among those countries reporting December data. Portugal’s unemployment rate was at 16.5 percent, while Ireland reported a jobless rate of 14.7 percent. Germany’s jobless rate was 5.3 percent and France’s stood at 10.6 percent. Austria had the lowest rate at 4.3 percent.

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