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Euro zone inflation stuck at 3%

Analysts had expected fall in euro zone inflation rate
Analysts had expected fall in euro zone inflation rate

Official figures show that the annual rate of inflation in the euro zone inflation is expected to remain stable at 3% in October.

This is the same level as in September but well above the threshold favoured by the European Central Bank for price stability.

Eurostat, the European Union's statistics agency, said it estimated annual inflation in the euro zone this month at 3%, above market expectations of a fall to 2.8% or 2.9%.

If confirmed, it will be the 11th month inflation has been abover the ECB target of below or close to 2%. The figure raises a first challenge for the ECB's new chief Mario Draghi, who takes the helm of the bank on Tuesday and chairs his first board meeting on Thursday.

The central bank has maintained its main interest rate at 1.5% despite fears of a new recession and rising inflation. But it has recently faced calls to lower rates. Today, the Paris-based Organisation for Economic Co-operation and Development said the euro zone should cut interest rates.

Separate Eurostat figures showed that euro zone unemployment climbed to 10.2% in September, the highest figure since June 2010.

Seasonally adjusted unemployment rose from 10.1% in August in the 17 nations that share the single currency, with more than 16 million people out of work, Eurostat said. It was the fifth month with one out of 10 people in the euro area estimated jobless.

Spain again registered the highest unemployment rate, at 22.6%, while Austria and the Netherlands recorded the lowest jobless figures at 3.9% and 4.5% respectively.