Horrific European economic data released

Spain is already in deflation, and this morning it released some horrible unemployment numbers.  Spanish unemployment soared to 17.4% in Q1, from 13.9% in Q4.  This is the first time unemployment has risen above 17% since 1998, and is further evidence of the alarming deterioration in the European economy. 

Also this morning it was announced that UK GDP was -1.9% in Q1, taking the year on year rate to -4.1% (equalling the annual rate recorded in Q4 1980, which was itself the worst year on year fall since records began in 1956). 

Then Bundesbank president Max Weber this afternoon said that the German economy may have contracted at least 3% in Q1 alone, which would be the worst quarter since records began in 1970.  The German unemployment rate is likely to exceed 10% later this year, and the Eurozone unemployment rate is already 8.5%.

The chart puts the Spanish unemployment data into an international context.  Unemployment measures do vary across countries, but the Spanish unemployment rate is considerably higher than any developed country, and is worse than a large number of developing countries (although note that emerging market data is a little old).  The higher the unemployment rate rises, the greater the national discontent and the more likely there will be a severe political crisis (and the more pressure there will be for some European countries to leave the euro). 

UK prime minister Gordon Brown must be jealous that his Spanish counterpart José Luis Rodríguez Zapatero had his election in March 2008, before the global economy began to really fall apart.