Recovery in eurozone may pick up in 2014, says Eurostat
Print Edition
Glimmers of hope emerged yesterday for the eurozone economy to suggest that the coming year will see the recovery gathering steam.
Official figures showed a stabilization in unemployment and the biggest increase in monthly retail sales in 12 years.
Eurostat, the European Union’s statistics office, said the eurozone’s jobless rate held steady in November at a record 12.1 percent for the eighth month running after a modest 4,000 rise in the ranks of the jobless to 19.24 million. Since September’s 12.2 percent rate was revised down, 12.1 percent is now the record.
The agency also said retail sales during the month spiked by 1.4 percent, way ahead of predictions in the markets for a more modest increase of around 0.3 percent. The rise was the biggest since November 2001.
Though much of the increase was due to a 2.1 percent rise in France, where consumers may have brought forward purchases ahead of a sales tax rise, analysts said the figures suggest households are increasingly confident that the financial crisis is past its worst and that the recovery has legs.
The increase followed two monthly declines and was fairly broad-based across the eurozone. The Iberian economies of Spain and Portugal did particularly well, posting gains of 1.9 percent and 3.1 percent, respectively.
“The outlook is starting to brighten a little for eurozone consumers,” said James Howat, European economist at Capital Economics.
Despite the signs of improvement, the eurozone continues to face huge problems and most economists think it will remain the laggard of the world economy.
Among the challenges will be to get unemployment down and prevent deflation, a sustained fall in prices that can encourage consumers to put off purchases in the hope of getting better bargains further down the line.
Yesterday’s figures highlighted disparities across the eurozone, which had 17 members in November — the bloc grew to 18 members following Latvia’s adoption of Europe’s single currency at the start of this year.
While countries like Germany and Austria have jobless rates around 5 percent, those at the forefront of Europe’s debt crisis, such as Greece and Spain, have more than one in four of their people out of work.
The situation among the young there is even worse, although Greece appears to be showing some improvement on that front, with 54.8 percent of those aged 15-24 out of work at last count in September, compared with 57.7 percent the previous month.
Policymakers are hoping the eurozone’s return to economic growth may get unemployment down. So far, the eurozone’s recovery from its longest-ever — though not deepest — recession has been paltry but most economists are predicting a modest pickup this year, with even Greece emerging from a six-year depression that has seen its overall economic output shrink by over a fifth.
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