Euro area unemployment rate falls to lowest rate recorded

Chelsea West
August 1, 2017

The euro was trading 0.1 percent weaker at $1.1730 and down about 0.4 percent from a January 2015 high of $1.1777 hit last Thursday.

In its latest forecasts, released in July, the International Monetary Fund estimated the euro zone would grow 1.9 percent this year and 1.7 percent in 2018, above Britain's projected growth of 1.7 percent this year and 1.5 percent next.

The eurozone notched up growth of 0.6% in the second quarter of the year, official Eurostat figures showed. That is the reason we are seeing the DAX move lower on every piece of good data from the Eurozone.

The latest unemployment news was also encouraging with the jobless rate sliding to an 8 year low 9.1%.

Bert Colijn, a senior eurozone economist at the bank ING, said the bloc had enjoyed a "surprisingly strong" first half to 2017.

Updated estimates of euro zone GDP growth in the second quarter will be released by Eurostat on August 16 and final data will come on September 7.

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Forward-looking surveys of business activity in the major sectors of the eurozone economy have also shown a stronger picture than in the United Kingdom this year.

"Although the exchange rate remains a key driver of export growth, manufacturers also benefitted from stronger economic growth in key markets in the euro area, North America and Asia-Pacific regions", Dobson said.

This was the lowest rate recorded in the eurozone since February 2009.

"The global economy has been a jumbo jet running on just one engine for the last five, six years, the US, but now it seems there's more from the euro zone as well, with encouraging signs from Asia too", said James Knightley, chief worldwide economist at ING.

Inflation among the 19 nations using the euro currency was 1.3 per cent this month compared with July 2016, driven mainly by energy costs, Eurostat, the European Union's statistics office said.

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