THE TAKEAWAY: Italian unemployment rises to 11.1% in November -> Highest unemployment rate on record -> Euro trading unchanged
Italian unemployment has risen to the highest rate seen on record, which goes back to the beginning of 2004. The unemployment rate for October was reported at 11.1%, according to a preliminary estimate by Istat. The rate was worse than expectations for 10.9% unemployment, and October’s unemployment rate was 10.8%. The average unemployment rate for the third quarter was reported at 10.6%.
The Italian economy is suffering and has contracted over the past five quarters. The government is predicting a 2.4% economic contraction this year, while the OECD is predicting a 2.2% slow down for the Italian economy.
However, despite the worse than expected unemployment in Italy, the Euro did not react to the news in forex markets. The Euro rallied above 1.3000 against USD earlier in the session, as ECB’s Draghi said he expects a Euro-zone recovery to start in 2H 2013. EURUSD is currently trading above 1.3000, which could now provide support. Resistance could be provided at 1.3025, by the 76.4% retracement of the decline from October’s high to November’s low.
EURUSD 15-minute: November 30, 2012