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Eurozone jobless numbers hit new high
Aggregated Source: Shanghai Daily: Business

UNEMPLOYMENT has reached a new high in the eurozone and inflation remains well below the European Central Bank's target, underscoring just how severe a challenge European Union leaders face to revive the bloc's sickly economy.

Joblessness in the 17-nation currency area rose to 12.2 percent in April, statistics agency Eurostat said yesterday, marking a new record since the data series began in 1995.

With the eurozone also in its longest recession since its creation in 1999, consumer price inflation was far below the ECB's target of just below 2 percent, coming in at 1.4 percent in May, slightly above April's 1.2 percent rate.

That rise may quieten concerns about deflation, but the deepening unemployment crisis is a threat to the social fabric of the eurozone, with almost two-thirds of young Greeks unable to find work exemplifying southern Europe's threat of creating a "lost generation."

Economists and policymakers have expressed concern that the greatest threat to the unity of the eurozone is now social breakdown from the crisis, rather than market-driven factors.

In France, Europe's second-largest economy, the number of jobless rose to a record in April, while in Italy, the unemployment rate hit its highest level in at least 36 years, with 40 percent of young people out of work.

Some economists expect the ECB, which meets next Thursday, to act to revive the economy and go beyond another interest rate cut to consider a United States-style money printing program known as quantitative easing.

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Copyright Shanghai Daily: Business