RTTN:Euro Down As Eurozone Jobless Rate Hits New Record High
The European currency weakened against other major currencies in European deals on Friday, as reports showed that Eurozone unemployment rate climbed to a new record high in April and inflation stayed below European Central bank's target in May, putting more challenges to the currency bloc in its struggle to recover the economy.
The latest figures published by Eurostat revealed that Eurozone's seasonally adjusted unemployment rate rose to 12.2 percent in April from 12.1 percent in March. The outcome matched economists' forecast.
According to Eurostat estimates, 19.375 million people in euro area were unemployed in April. This was 95,000 higher than in March and exceeded previous years' level by 1.644 million.
Total jobless rate in EU 27 remained unchanged at 11 percent in April.
A preliminary data from the same agency showed that Eurozone annual inflation accelerated in May for the first time in nine months.
Inflation rose to 1.4 percent from April's 1.2 percent, in line with economists' expectations. The figure climbed for the first time since August last year, when it was 2.6 percent.
The European Central Bank targets inflation "below, but close to 2 percent."
The euro fell to 1.2979 against the greenback, reversing from a 3-week high of 1.3060 reached on Thursday. On the downside, the euro has support around 1.29 level.
The euro depreciated 1.28 percent to 130.38 against the Japanese yen from an early Asian session's 3-day high of 132.07. If the euro-yen pair continues its downtrend, it may eye support around 129.5 level. The pair closed Thursday's deals at 131.39.
The International Monetary Fund on Friday endorsed Japan's monetary easing program and said the recent depreciation of yen is "not problematic."
"So long as monetary easing pursues domestic goals, and is accompanied by comprehensive fiscal and structural reforms," the Fund said in a regular review report.
The euro declined to 1.2379 against the Swiss franc, a level not seen since May 10. The euro thus lost 0.44 percent against the franc from Thursday's close of 1.2434. The euro is poised to break next downside target level around 1.23.
A leading indicator of Switzerland's economic activity increased for a second consecutive month in May, the KOF Institute said in a report today.
The economic barometer rose to 1.10 in May from April's revised score of 1.04. The indicator has gained 0.02 points in April.
The euro declined to an 8-day low of 0.8533 against the pound, down 0.51 percent from a high of 0.8577 hit at 4:30 am ET. The next support for the euro-pound pair lies around 0.845 area. At Thursday's close, the pair ended trading at 0.8562.
U.K. mortgage approvals for April rose marginally to 53,710 from 53,674 in March, the Bank of England said today. But it was below the consensus forecast of 54,600.
The euro fell back against the Canadian dollar amid the data, after touching a high of 1.3496 at 4:35 am ET. The euro-loonie pair is now trading at 1.344 level, at which it closed Thursday's deals.
Looking ahead, Canada GDP for March, U.S. personal income and spending for April and Reuters/ University of Michigan's final consumer sentiment index for May are due in the North American session.
