Wednesday, January 13, 2010

Euro zone jobless jump, Q3 GDP may spell momentum loss

Euro zone jobless jump, Q3 GDP may spell momentum loss

Fri Jan 8, 2010 9:00am EST

(Corrects second paragraph to say number of people without jobs rose to 15.712 million not 3.041 million)


* Unemployment jumps to more than 11-year high in November

* Q3 inventory contribution to GDP revised upwards

* Net trade contribution smaller than thought

* Q3 private investment falls more than earlier estimated

By Jan Strupczewski

BRUSSELS, Jan 8 (Reuters) - Euro zone unemployment jumped to an 11-year high in November, data showed, and is likely to rise more next year in what could add to the instability of economic recovery now based on fickle inventory rebuilding and exports.

The European Union's statistics office Eurostat said the number of people without jobs rose by 102,000 in November to 15.712 million, or 10 percent of the workforce in the 16 countries using the euro -- the highest since August 1998.

For a graph of euro zone unemployment see: here

"We think that the unemployment rate will continue to rise until around the third quarter of this year before remaining at these higher levels through 2011," said Nick Kounis, economist at Fortis Bank.

"The upshot is that consumer spending will remain weak for a protracted period and that the overall economic recovery will be slow," he said.

The European Union's statistics agency confirmed its earlier estimate that the euro zone exited recession in the third quarter with 0.4 percent quarter-on-quarter growth after five quarters of falling output. [ID:nBRQ009663]

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