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imageROME: Italy's seasonally adjusted unemployment rate eased unexpectedly to 11.6 percent in February from January's 21-year high of 11.7, national statistics agency ISTAT reported on Tuesday.

The figure was below the average forecast in a Reuters survey of analysts which pointed to a further rise to 11.8 percent, and was the first fall in the jobless rate since July last year.

Youth unemployment also declined to 37.8 percent from January's record high of 38.6 percent.

The employment rate - showing the proportion of Italians in work as a proportion of the population - edged up 56.4 percent from January's 56.3 percent, which had been the lowest level for 13 years.

Unemployment, which was major issue in February's inconclusive national election, has been rising steadily since early 2011 as Italy has languished in its longest recession for 20 years.

Analysts say the biggest challenge for Italy is to increase its chronically low rates of employment and participation in the labour market, which are among the lowest in the industrialized world, especially among women, the young and the elderly.

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