| German unemployment rate falls in September |
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30/09/2009 16:34 (51 Day 21:17 minutes ago) | |||||
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The FINANCIAL -- German unemployment fell in September, thanks to a seasonal upturn and statistical effects rather than any fundamental economic improvement, official figures showed on September 30.
The raw unemployment rate, the headline figure in Germany, fell to 8.0 percent, the Federal Labour Agency reported, and the seasonally-adjusted rate dipped for the the third month running to 8.2 percent, AFP informs. Labour agency president Frank Weise said in a statement that the latest results "were not a change in the trend," which has been upwards.
A total of 3.346 million people were registered as unemployed — 125,000 fewer than the previous month but 266,000 more than in September 2008, according to AP. However, "this is not a turnaround," said Frank-Juergen Weise, the head of the Federal Labor Agency. He said the main reason for the drop was the usual upturn in employment following the summer vacation.
Also Wednesday, data showed that consumer prices across the 16 countries that use the euro fell more steeply in September than in August, in line with bigger-than-expected declines in Germany, Spain and Belgium, The Wall Street Journal wrote. The European Union's official statistics agency Eurostat Wednesday said the flash estimate of the annual consumer price index in the euro zone fell 0.3% from a year earlier in September. In August, the CPI declined 0.2%.
The steeper drop wasn't expected by economists surveyed by Dow Jones Newswires last week, who had predicted a 0.2% decline. However, the drop was in line with estimates from Germany Monday and Spain and Belgium Tuesday showing that CPI in each country fell by more than had been expected, according to the same source. Germany's statistics agency said the decline was due to lower food and energy prices, but economists said Monday that this trend isn't likely to last and consumer prices should start rising again in the coming months. They added that the same is true for the euro-wide inflation measure.
Wednesday's jobless figures were the first since Chancellor Angela Merkel was re-elected. Sunday's election result allows her to ditch her right-left "grand coalition" of the past four years for a center-right government with a new, pro-business partner, AP reported. Both sides of the incoming coalition advocate tax relief to spur the economy, but it is unclear whether coalition talks starting next week will result in substantial cuts.
Merkel's room for maneuver is limited by the fact that Germany has racked up debt to tackle the crisis, the same source reported. On Wednesday, the Federal Statistical Office said the deficit in the overall public budget increased to euro57.2 billion ($83.5 billion) in this year's first half from euro6.9 billion a year earlier as spending rose sharply and revenue declined. It did not give the figure as a proportion of gross domestic product.
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