Spot the trend.

It’s pretty clear which direction European unemployment stats are heading in, with eurozone unemployment sinking to 9.5 per cent in February, in line with expectations and the lowest since May 2009.

That’s down from 9.6 per cent in January and from 10.3 per cent from February 2016. (Here’s the release from Eurostat.)

The Czech Republic and Germany continue to be teacher’s pets, while Greece and Spain remain hobbled by ugly jobless levels.

The youth unemployment rate for the currency bloc also retreated, but from very high levels, to 17.3 per cent. It stands at some 45.2 per cent in Greece, 41.5 per cent in Spain and 35.2 per cent in Italy, but is just 6.6 per cent in Germany.

Pantheon Macroeconomics reckons the overall drop in unemployment is consistent with a pick-up in inflation, as its chart below shows:

It notes:

Lower joblessness in Spain, Italy and Portugal were the key drivers of the headline decline in EZ unemployment last month. And the advance data in Germany—which showed a further decline in unemployment here—suggest that next month’s EZ report will show a further decline. These data extend the longest period of falling unemployment in the euro area since the data series began. But this upbeat news has to be seen in the context of a still-high level of joblessness. The labour market is a lagging indicator in the euro area, and we think unemployment will continue to edge lower this year.

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