Euro zone unemployment falls to 6.5% in March
BRUSSELS – Euro zone unemployment rate fell to 6.5 percent in March, the European Union’s statistics office Eurostat said, a decline that points to a further tightening of the labor market and spells more trouble for the European Central Bank in fighting inflation.
The March unemployment rate in the 20 countries using the euro is lower than expected by economists polled by Reuters, who forecast an rate unchanged from February at 6.6 percent.
Eurostat said the number of people without jobs fell to 11.01 million in March from 11.131 million in February.
The tightest labor market was in Germany, where the jobless rate fell to 2.8 percent of the workforce from 2.9 percent in February, which is likely to have helped German trade unions negotiate substantial pay rises.
The higher wages, however, in Germany and elsewhere, are likely to make much harder the ECB’s job of bringing down inflation, which in April run at 7 percent year-on-year against the bank’s target of 2 percent.