Eurozone inflation nears ECB target
AFP and APBRUSSELS/LONDON -- The eurozone crowned a week of steadily improving economic data on Friday with inflation almost down to the European Central Bank's (ECB) medium-term target, falling to 2 percent in January after overshooting for more than two years, EU data showed.
February 2, 2013, 12:05 am TWN
Marking good news for leaders of the 17-state currency area preparing for next week's European Union summit, the drop from 2.2 percent in December took the measure of annual price rises to the lowest level since 1.9 percent in November 2010.
Separately, chronic and rising unemployment across the eurozone appeared to stabilize in December at a rate of 11.7 percent.
However, the latest EU data still showed almost 19 million people without work.
Though the 11.7 percent unemployment rate reported by Eurostat, the EU's statistics office, for November was below market expectations for a rise to 11.9 percent, it still remains the highest level since the euro was launched 14 years ago, as November's original estimate of 11.8 percent was revised down.
The ECB has established a medium-term inflation target of below, but close to, 2.0 percent.
Eurostat's flash estimate approached that threshold owing to easing pressure on energy prices, which rose by 3.9 percent in January, down from 5.2 percent in December.
Eurozone inflation has been falling since August and benchmark Germany posted a rate of 2 percent in December, although major markets in Italy and Spain each still posted rates well above the eurozone average.
Compared with figures a year earlier, the eurozone has shed 1.796 million jobs.
The lowest unemployment rates again were recorded in the wealthier north, with Austria on 4.3 percent, Germany and Luxembourg each on 5.3 percent and the Netherlands on 5.8 percent. Greece and Spain continue to log the highest rates, at 26.8 percent in October and 26.1 percent in December, respectively.
Using seasonally adjusted Eurostat calculations for comparative purposes, in December 2012, the unemployment rate in the U.S. was 7.8 percent. In Japan it was 4.1 percent in November 2012.
The monthly purchasing managers index — a gauge of business activity — from financial information firm Markit rose to an 11-month high of 47.9 in January from December's 46.1. Though the measure remains below the 50 threshold that divides expansion from contraction, the index's trend points to the sector growing again over the coming months.