Unemployment down, inflation rose

During the last policy meeting Mario Draghi predicted a long period of weak inflation and sluggish growth, suggesting the Eurozone economy is not on a path to recovery yet, and cut the benchmark interest rate by 25 basis points to a record-low of 0.25%. Friday's data are; however, pointing at some improvement in the 17-nation bloc, as unemployment inched lower from its all-time high, while inflation picked up more than expected. On the back of positive releases the Euro managed to close above 1.36.

The jobless rate in the Eurozone slid to 12.1% in October from a record-high of 12.2% a month earlier, while in the broader EU the same indicator remained unchanged at 10.9%. The situation in the labour market among people under 25, in the meantime, worsened further, with the unemployment rate moving higher to 24.4%, with Italy's youth unemployment soaring to 41.2%, and situation in Spain deteriorating as well, even despite the economy emerging from the recession. The measure of price level, that was the last drop for Draghi to adjust ECB's monetary policy, climbed 0.9% year-on-year in November, bouncing off almost a four-year low seen a month earlier. Moreover, core CPI, which excludes food, energy, alcohol and tobacco prices, jumped 1.0% from a 0.8% increase in October. Despite the positive data, inflation stayed below 1% for a second month in a row, less than a half the ECB's ceiling.