Eurozone unemployment is at a record high and consumer prices are being driven upward by volatile energy and food prices, data showed yesterday, underlining the fragility of the bloc’s economic health.

Inflation in the 17-nation eurozone, which is suffering from its longest ever recession, increased to 1.6 per cent year-on-year in June from 1.4 per cent in May, the EU’s statistics office Eurostat said.

Joblessness in the bloc stood at a record 12.1 per cent in May, with the number of people out of work rising further above 19 million, Eurostat added.

Government austerity programmes across the continent have helped fuel the economic hardship and provoked widespread public discontent, especially with more than half of young people unemployed in Greece and Spain.

June’s inflation reading was the second upward move from a three-year low of 1.2 per cent in April, although it remains beneath the European Central Bank’s target of just under two per cent.

Economists expect inflation to remain below the target for the rest of this year, giving the ECB scope to leave interest rates at a record low, although signs of improvement at European factories may stop the bank from cutting rates again. (Reuters)