By Maria Martinez
BERLIN, Sept 30 (Reuters) – The number of unemployed people in Germany rose significantly more than expected in September and inflation rose in five states, pointing to a national increase.
In seasonally adjusted terms, the jobless figure grew by 12,000 to 3.01 million, labour office figures showed on Wednesday. Analysts polled by Reuters had predicted an increase of 1,000.
The seasonally adjusted jobless rate remained stable at 6.4%.
The overall unadjusted number of unemployed people dipped slightly under the 3 million mark in September after sitting above that figure for two months in a row.
LABOUR MARKET SLUGGISH
The autumn pickup in Germany’s labour market typically begins in September, but this year’s start has been sluggish, labour office head Andrea Nahles said in a statement.
“The economic improvement is not yet reaching the labour market,” Nahles added.
Gross domestic product in Europe’s largest economy grew more than expected in the first half of the year, leading economic institutes to revise up their forecasts, but the economy lost steam in the third quarter.
Looking ahead in the labour market, a cyclical stabilisation should be in the making, said Carsten Brzeski, global head of macro at ING.
“However, the structural trends are likely to continue,” he added, pointing to cost-cutting measures across the automotive industry and the high level of bankruptcies.
INFLATION EXPECTED TO INCREASE IN SEPTEMBER
Adding to the gloom, inflation rose in five key German states in September, preliminary data showed on Wednesday, showing the impact from higher energy prices due to the Iran war.
The state inflation data points to rising headline inflation in Germany for September, with little change in the core inflation rate, which excludes volatile food and energy prices, said Claus Vistesen, chief euro zone economist at Pantheon Macroeconomics.
Economists polled by Reuters are forecasting a harmonised national inflation rate in Germany of 3.2% in September, up from 2.9% in the previous month. National figures will be released later on Wednesday.
Economists warn that the recovery of Europe’s biggest economy is not yet self-sustaining as high energy prices and economic policy uncertainty are weighing on household consumption.
German retail sales rose less than expected in August, increasing by 1.3% compared with the previous month, data showed on Wednesday.
(Reporting by Maria Martinez and Klaus Lauer; Writing by Miranda Murray; Editing by Ludwig Burger and Alison Williams)
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