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Euro zone producer prices up in October, unemployment falls

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BRUSSELS (Reuters) - Euro zone producer prices rose more than expected month-on-month in October and unemployment fell as the economy continued to recover before the second wave of the COVID-19 pandemic struck, data showed on Wednesday.

The European Union’s statistics office Eurostat said prices at factory gates in the 19 countries sharing the euro rose 0.4% month-on-month for a 2.0% year-on-year decline. Economists polled by Reuters had expected a 0.2% monthly increase and a 2.4% annual fall.

Producer prices are an early indication of final prices paid by consumers, which the European Central Bank wants to keep below, but close to 2% over the medium term, but has failed to reach that target for the past eight years.

Energy costs were the main factor driving producer price index in October, as energy prices rose 1.4% on the month for a 7.6% year-on-year fall. Without that volatile component, prices at factory gates rose 0.1% on the month and fell 0.2% on the year.

Separately, Eurostat said euro zone unemployment fell by 86,000 people to 13.825 million or 8.4% of the workforce from 8.5% in September.

Reporting by Jan Strupczewski; editing by Philip Blenkinsop

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