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It's particularly grim in Spain, which is at the forefront of Europe's debt crisis concerns. It had the highest unemployment rate across the eurozone of 24.8 percent. Greece's rate was not far behind at 22.5 percent, though the latest figures available are for April. In Greece and Spain, every other person aged under 25 is unemployed. Many countries that use the euro, including France and Italy, also have double-digit unemployment rates. Even if new anti-crisis measures are to be announced this week, many analysts think the eurozone appears headed for recession. Germany, Europe's biggest economy, is showing increasing signs of coming off the boil. With growth dropping sharply and demand for its high-value exports set to fall, German unemployment is expected to start rising again. Figures earlier from Germany's Federal Labor Agency showed the unadjusted jobless rate climbing from 6.6 percent in June to 6.8 percent in July as the typical seasonal increase of school-leavers signing on for unemployment benefits was reinforced by a gradual slowing in the labor market. Elsewhere, Eurostat revealed Tuesday that inflation was unchanged at 2.4 percent in July. Though that remains above the ECB's mandated target of keeping price increases just below 2 percent, the recent trend has been downward and analysts expect that to continue. A stagnating economy and rising unemployment, which combine to keep a lid on wage increases, are expected to push inflation back below target over the coming months. Lower energy inflation is also expected to ease inflationary pressures. This opens the door for the ECB to cut its benchmark rate below its current record low of 0.75 percent in addition to any anti-crisis measures it announces.
[Associated Press; By PAN PYLAS]
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
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