- Anatoli Annenkov, an economist at Societe Generale SA
While some analysts and politicians are already claiming the worst for Europe is over, this week's unemployment numbers may lay bare a fault line scarring the ongoing recovery as German labour market's solid performance contrasts with struggling Italian. The longest-ever recession is over; however, the unemployment still hovers at 12% in September, according to the majority of analysts. There is currently a rift between two of region's largest economies, with Italy's unemployment at 12.3%, the highest since 1977, while German jobless level almost twice less. According to European Central Bank Executive Board member Joerg Asmussen, Italy will determine the fate of the whole region, and unless it is not starting to recover, the European Union will not be able to prosper. Furthermore, Italian authorities are expecting the situation in the labour market to deteriorate with jobless rate keeping rising against a backdrop of a fragmented coalition jeopardized by the legal woes of Silvio Berlusconi, country's former Prime Minister.
The single currency is trading around a two-year high versus the greenback amid growing fiscal uncertainty in the United States and economic recovery in the Eurozone. However, with unemployment rate among people aged between 15 and 24 in Italy standing at historic high of 40.1%, and in the whole region at 23.3%, the future of European economies remains highly uncertain.
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