The euro zone unemployment rate improved only marginally in February, official data showed today, stoking concerns the economy could be slowing after only a modest recovery.
Analysts said that while the economy is holding up despite recent financial market volatility and concerns over the outlook for China, job gains may not be enough to help it get it through the current soft patch.
The Eurostat statistics agency said unemployment in the euro zone fell to 10.3% in February, a four and a half year low, from a revised 10.4% in January.
The January figure was originally given as 10.3% last month and analysts had expected the February jobless rate to come in unchanged at 10.3%.
Euro zone unemployment hit a record high 12.1% during the worst of the debt crisis.
Analysts said that today's figures suggest the labour market remains in reasonable health although it is still too weak to generate any real inflationary pressure.
Inflation - a key reflection of consumer demand - has bounced along the bottom for months, way short of the European Central Bank's target of near 2%.
They said that looking ahead, the survey evidence suggests that the euro zone's labour market recovery is beginning to slow.
The ECB launched a massive stimulus programme in early 2015 but to little apparent effect and last month added even more unprecedented measures in an effort to get the economy back on track.
The ECB at the same time cut its euro zone growth forecasts for 2016 and 2017 to 1.4% and 1.7%, from the previous 1.7% and 1.9%, respectively.
More damaging still, it also cut its inflation estimates to just 0.1% from 1% for this year and to 1.3% from 1.6% for 2017.
Eurostat said there were 16.63 million jobless in the euro zone in February, down 39,000 from January.
The EU unemployment rate was unchanged at 8.9% in February, it said.
The lowest jobless rates were in Germany, at 4.3%, and the Czech Republic on 4.5% while the highest were in debt-laden Greece at 24% and Spain with 20.4%.
Analysts said that while euro zone unemployment fell for a 15th consecutive month, it was notable that the decline of 39,000 was the smallest drop since May 2015.
They said this increases concern that recent slower euro zone growth and softer business confidence could now be increasingly weighing down on the labour market.
But on the positive side, the improvement might encourage the consumer to spend more, which will be crucial if euro zone growth is to be able regain momentum over the coming months after stuttering recently.
The euro zone economy grew 0.3% in the last three months of 2015, unchanged from the previous quarter but down on the 0.4% gain of the second quarter and 0.6% in the first.
