Italy unemployment rises beyond expectations on weak business structure

Italy’s April unemployment rose beyond expectations on weak business structure amid sluggish household expectations for a moderate Euro area recovery. Consumer prices on an annual basis fell for the fourth straight month in a row in May.

The jobless rate rose to 11.7 percent from a revised 11.5 percent in March, national statistics agency Istat said Tuesday in Rome. According to a median estimate from Bloomberg’s poll of economists, 11.4 percent rise was expected. The reading matched the level in January and February, while the previous high was 12.2 percent in June.

"There are some positive signs that suggest the employment rate can improve, but there are still a number of obstacles ahead," said Andrea Brasili, Economist, Pioneer Investment Management in Milan, before the data came out.

In a May 27 report published by Istat, manufacturing confidence and consumer morale unexpectedly dropped this month, signaling pessimism among executives and households over the long-run growth prospects, Bloomberg reported.

Youth joblessness increased in April to 36.9 percent from 36.7 percent in March, data released by Istat showed. Meanwhile, according to forecasts by the International Monetary Fund, the Italian economy is expected to expand 1.1 percent through 2016.