Euro-Zone Unemployment Rate Makes New 10 Year High As Recovery Seems Unstable
Euro-zone’s unemployment rate continues to climb to new highs as it reaches 9.6% in August from the previous 9.5% in July. Although the German and French economies pulled out of recession in the second quarter, recent data is showing a mixed signal for the struggling Euro-zone, as it tries to stabilize its recovery path. Rising unemployment continues to be a fear for consumers as it will continue to hinder spending thoughout the rest of the year, keeping in mind that the German government is still subsidizing companies to retain employment, which is keeping the German unemployment stable. According to ECB’s president Jean-Claude Trichet, we will continue to see a “bumpy” recovery as unemployment will continue to suppress growth “for some time”. The ECB is in no rush to withdraw from quantitative easing as it is expected that the benchmark rate will be kept at its current lows well into the first half of 2010
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