EU unemployment holds at 8-year low

Analysts predict a rate of 9.1 pct

BRUSSELS, Oct 2, (Agencies): Unemployment in the eurozone remained stable in August at an eight-year low, underlining Europe’s continued economic recovery, official EU figures showed on Monday.

The jobless rate in the 19-country single currency area in August was 9.1 percent, the same as July and down from 9.9 percent in August 2016, the Eurostat statistics agency said in a statement.

“This remains the lowest rate recorded in the euro area since February 2009,” it said.

Analysts at the data company Factset had predicted a rate of 9.1 percent.

Unemployment remained high in nations hit by the eurozone debt crisis with Greece on 21.2 percent, in JuneJuly, the last month for which figures were available, Spain at 17.1 percent, and at 11.2 percent in Italy, and 10.7 percent in Cyprus.

But it continued to decline in Germany, with 3.6 percent in August compared to 3.7 percent in July, and in the Netherlands, with 4.7 percent compared to 4.8 percent the previous month.

In France, the rate increased to 9.8 percent in August from 9.7 percent in July. The unemployment rate for the entire 28-nation bloc stood at 7.6 percent in August, down from 7.7 percent in July and from 8.5 percent in August 2016, Eurostat said.

“This is the lowest rate recorded in the EU28 since November 2008,” it added.

Meanwhile, Spain’s government borrowing costs surged and its stock market slumped on Monday as investors weighed political fallout from a violent police crackdown on an independence vote in Catalonia.

The euro also drifted lower against the dollar after local officials said 90 percent of voters favoured secession in Sunday’s referendum, which Madrid declared illegal.

That opens the door to a unilateral declaration of independence in a region that accounts for a fifth of Spain’s economy.

Analysts said the uncertainty could impact the country’s economic growth while reports of injuries to more 800 people could taint the reputation of Prime Minister Mariano Rajoy, who heads a minority government.

“This issue is likely to complicate policy-making at a national level as opposition parties seek to gain political capital from what is arguably a gross PR error on the part of PM Rajoy’s government,” said Richard McGuire, head of rates strategy at Rabobank in London.