New High in Euro Zone Jobless Rate, German Retail Sales Rise

Arthi Gupta
31 Oct, 2012
New York City

The European indexes gained after the euro area jobless rate rose to a record 11.6% and German retail sales improved in September. The UK consumer confidence fell to a six-month low in October.

[R]3:30 PM Frankfurt – The European indexes gained after the euro area jobless rate rose to a record 11.6% and German retail sales improved in September. The UK consumer confidence fell to a six-month low in October.[/R]

European indexes edged higher after German retail sales improved in September. However, the euro area jobless rate rose to a record 11.6% from the previous record of 11.5% in August but inflation eased to 2.5% in October.

Euro zone finance ministers are to hold a conference call today and the focus is on Greece. The leaders will have to make a decision on disbursing the next tranche of the €31.5 billion bailout money for Greece.

In Paris trading, the CAC-40 Index climbed 4.58 or 0.1% to 3,463.45 and in Frankfurt the DAX Index edged higher 34.33 or 0.5% to 7,318.46.

The yields on Spain’s benchmark 10-year declined seven basis points to 5.60%. Italian 10-year yield were at 4.967%.

German, French Bond Auctions

Germany auctioned €1.7 billion or $2.2 billion of 30-year bonds at an average yield of 2.34% compared with an average yield of 2.17% at the previous sale on July 25. The bid-to-cover ratio rose to 2.7 from 1.5 at the prior auction.

Separately, France sold €4.37 billion of benchmark 10-year bonds at an average yield of 2.22% compared with an average yield of 2.28% at the last auction on October 4.

The country also auctioned €1.49 billion of seven-year notes and €1.64 billion of bonds maturing in 2035.

Euro Area Jobless Rate Rises, Inflation Eases

The euro area unemployment rate increased to a record 11.6% in September from a revised 11.5% in August, Eurostat said today.

About 18.49 million people were unemployed in September, up 146,000 from August. Compared with September 2011, unemployment rose by 2.174 million.

The EU27 jobless rate remained stable at 10.6%. The lowest unemployment rate of 4.4% was recorded in Austria and Spain reported the highest rate of 25.8% Spain and Greece 25.1%.

Separately, euro zone inflation eased to 2.5% in October from 2.6%in September, according to a flash estimate released from Eurostat today.

Prices of food, alcohol and tobacco increased 3.2% in October.

German Retail Sales Improve

German retail sales rose 1.5% on a monthly basis in September compared to the 0.1% rise in August, data released by the Federal Statistics Office showed.

Retail sales fell 3.1% annually in September compared to the 1.1% drop in August

France Consumer Spending Climbs

French households’ expenditure on goods rose 0.1% on a monthly basis in September, following a 0.8% drop in August, data released by the statistics agency INSEE showed today.

The slight increase in September was attributable to the increase of expenditure on household durables. Households’ expenditure on durables increased 0.6% in September after a 0.8% fall in August.

Annually, spending dropped 0.3% in September.

UK Sentiment Declines

The UK consumer confidence fell to a six-month low in October, a survey by GfK NOP showed today.

The consumer confidence index fell to -30 in October from -28 in September.

A measure of expectations for the general economic situation over the next twelve months decreased to -29.

The index measuring changes in personal finances during the last twelve months decreased three points this month to -24; this is the same level as October 2011.

Italian Jobless Rate Up

Italy’s jobless rate rose to 10.8% in September from 10.6% in August, data released by statistics office Istat showed. In September last year, the jobless rate was 8.8%.

The number of unemployed increased to 2.774 million in September, representing a 2.3% rise from August. On an annual basis, unemployment rose 24.9%.