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German jobless rate hits new historic low

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Frankfurt am Main (AFP)

Fewer people were out of work in Germany in May than at any time since the country's 1990 reunification, official data showed Wednesday, defying gathering fears for the eurozone economy.

Just 5.2 percent of the workforce was unemployed this month, the federal labour agency (BA) said in seasonally-adjusted figures -- a fall of 0.1 percentage points from April's level.

In unadjusted terms, which are less representative of underlying trends but more widely used in public debate, the jobless rate was 5.1 percent, or 2.3 million people.

Unemployment has been falling for years in Europe's powerhouse economy, driven both by an insatiable appetite for its goods from abroad and healthy consumer demand at home.

Germany's economy expanded by 2.2 percent in 2017, and government and private-sector forecasts suggest it could match or beat that performance this year.

A softer patch in early 2018, with slower first-quarter growth and weakened confidence indicators, has not put firms off their hiring spree.

But other dangers are looming for Germany, including a June 1 deadline for US President Donald Trump to decide whether to exempt European Union countries permanently from new tariffs on metals imports.

Upholding the border taxes could spark a tit-for-tat trade war between Washington and Brussels.

Meanwhile, governments and financial markets across Europe and the world are looking with dread towards Italy, where the risk that insurgent anti-euro single currency parties could form a government remains high.

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