EU inflation reaches 20 month high as unemployment crosses 10%- Business News- EU

Business News, Finance, World News, Europe, EU, Inflation

From: http://www.businessweek.com

European inflation accelerated to the fastest pace in more than 1 1/2 years on rising energy costs and unemployment held at the highest in almost 12 years.

European companies may have more scope to raise prices and add workers over the coming months as the economy shows signs of weathering a stronger euro and the Greece-led fiscal crisis. Economic confidence rose to the highest in more than two years in July and German unemployment declined, data this week showed. Volkswagen AG, Europe’s biggest carmaker, yesterday reported its biggest quarterly profit in two years.

“The pace of job-shedding has probably come to a halt,” said Chiara Corsa, an economist at UniCredit Group in Milan. Still, “we see the boost from both exports and inventories gradually fading throughout the second half of the year, with domestic demand unlikely to take up the baton.”

The euro was little changed against the dollar after the data, trading at $1.3047 at 10:02 a.m. in London, down 0.2 percent on the day.