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Euro zone inflation holds at 0.6 pct, jobless up

Published 04/30/2009, 05:06 AM
Updated 04/30/2009, 05:08 AM

BRUSSELS, April 30 (Reuters) - Euro zone inflation remained at a record low of 0.6 percent year-on-year in April, a first estimate showed on Thursday, as unemployment continued to climb quickly amid the worst European recession since World War Two.

Data from the European Union's statistics office showed consumer inflation in the 16 countries using the euro remained unchanged from March levels, as expected by markets.

No monthly data or a detailed breakdown were available.

The European Central Bank, which meets on interest rates on May 7, wants inflation to be just below 2 percent and has signalled it will cut its main refinancing rate by 25 basis points to 1.0 percent.

It is also likely to announce other ways of monetary policy easing, such as lengthening the maturity of its refinancing operations to 12 months from six or buying corporate or bank bonds, economists said.

Eurostat also said euro zone unemployment rose to 8.9 percent in March from an upwardly revised 8.7 percent in February, taking the number of people without jobs to 14.158 million, up 419,000 from the previous month.

The euro zone's biggest economy, Germany, saw unemployment increase to 7.6 percent of the workforce in March from 7.4 percent in February, while joblessness in France rose to 8.8 percent from 8.6 percent.

Spain saw the steepest jump in unemployment, to 17.4 percent from 16.5 percent, with Ireland not far behind with a rise to 10.6 percent from 10.0 percent. (Reporting by Jan Strupczewski, editing by Dale Hudson)

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