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German Jobless Rate Hits Record Low Despite Weaker Economy

(RTTNews) - Germany's unemployment rate unexpectedly fell to a record low in November and the number of unemployed decreased more than expected, despite a weaker economy.

The seasonally adjusted jobless rate dropped to 5 percent from 5.1 percent in October, figures from the Federal Employment Agency showed on Thursday. Economists had expected the rate to remain unchanged.

The number of unemployed fell by 16,000 persons from the previous month, when it dropped 12,000 persons. Economists had expected a decline of 10,000.

Earlier on Thursday, figures from the Federal Statistical Office showed that Germany's employment level in October hit a record high since reunification. The employment grew by 1.2 percent or 556,000 persons year-on-year to over 45.1 million.

The adjusted ILO jobless rate in October eased to 3.3 percent from 3.4 percent from the previous month.

The brighter figures from the labor market is in contrast to other main economic indicators.

The biggest Eurozone economy shrunk for the first time since early 2015 in the third quarter, down 0.2 percent, on weak exports and lackluster car sales.

The German private sector growth slowed in November to its lowest level in almost four years, the purchasing managers' survey from IHS Markit showed.

The closely-watched Ifo business confidence indicator eased for a third consecutive month in November as the economy is "cooling down".

Meanwhile, the Bundesbank has brushed off the latest GDP decline as a blip and expects the economy to return to an expansionary course before the year is out.

Bundesbank economists attributed the latest economic contraction mainly to a strong temporary one-off effect in the automotive sector as the introduction of an EU-wide emissions test procedure resulted in major problems that led to widespread production stoppages.

The bank expects output and automobile exports to return to normal and private consumption to reclaim its role as the major economic driver.
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