BERLIN: The number of unemployed people in Germany hit a 12-year high on Friday, surpassing the 3 million mark, while inflation moved back above the European Central Bank’s 2 percent target, clouding the outlook for Europe’s largest economy after a stronger-than-expected end to 2025.
German inflation unexpectedly nudged slightly higher in January, accelerating to 2.1 percent year-on-year, data showed. Analysts polled by Reuters had forecast EU-harmonised inflation remaining unchanged from December at 2.0 percent. Separately, Labour Office figures on Friday highlighted the lag in the jobs market from the economic stagnation of the last few years, with 177,000 more people out of work in January than in December, bringing the total to 3.08 million.
The unemployment rate jumped by 0.4 percentage points to 6.6 percent in seasonally unadjusted terms.
Chancellor Friedrich Merz has promised to revive the economy after two years of mild contraction, pledging a sharp increase in infrastructure and defence spending.
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