Eurozone Unemployment Rate Hits Fresh Record Low

Euro area unemployment rate dropped to a fresh record low in March despite the 20-nation currency bloc experiencing a modest economic growth.

The jobless rate slid to 6.5 percent in March from 6.6 percent in February, data from Eurostat showed on Wednesday. In the same period last year, the unemployment rate was 6.8 percent.

Data showed that unemployment decreased by 121,000 in March from February. Compared to the previous year, the number of unemployed fell by 365,000.

There was 2.264 million unemployed among young persons aged below 25. The youth unemployment rate was 14.3 percent in March, down from 14.4 percent in February. EU27 jobless rate was also 14.3 percent. However, the rate fell from a higher level of 14.5 percent posted in February.

The overall unemployment rate in the EU27 held steady at 6.0 percent in March. This was down from 6.2 percent in March 2022. The latest flash Purchasing Managers' survey showed that the increase in employment in the private sector was the strongest in 11 months amid a pick up in the service sector jobs growth to the quickest since July 2007.

Nonetheless, manufacturing employment growth eased to the lowest seen over the past 27 months.

The monetary policy announcement from the European Central Bank is due on May 4. Economists have forecast a 25 basis point hike this month as inflation data showed an acceleration to 7.0 percent from 6.9 percent.

At the March meeting, the ECB had increased the key refi rate by 50 basis points as inflation is forecast to remain high for too long.

The euro area economy grew only 0.1 percent in the first quarter. The Washington-based International Monetary Fund forecast growth in the euro area to ease sharply to 0.8 percent in 2023 before improving to 1.4 percent next year.