Spanish unemployment falls as business picks up for banks

A strong start to the tourist season helped Spain’s unemployment rate fall to its lowest in two years while two banks with large local customer bases said business had picked up, fuelling hopes the country’s economic revival is gathering pace.

With a minister suggesting the government might raise its GDP forecast, data showed joblessness fell at the fastest quarterly rate on record between April and June.

Spain has been in and out of recession since a housing bubble burst in 2008, saddling its banks with billions of euros of soured property assets and loans and leaving millions of labourers out of a job.

The crisis sent the unemployment rate from a low of 8 per cent in 2007 to a high of 27 per cent last year.

Yesterday’s data from statistics institute INE showed the rate fell to 24.5 per cent from 25.9 per cent in the first quarter.

Spain’s unemployment figure remains the second highest in Europe, but the drop was the sharpest year-on-year since early 2006 – before the start of the financial crisis. – (Reuters)