Spain's unemployment rate is likely to rise further in the coming months and is expected to reach nearly 21% in 2010, the BNP Paribas said in a report released on Friday.
In September, unemployment increased 2.2% month-on-month after the 2.4% rise in the previous month. On a yearly basis, unemployment was up 41.3% in September compared to 43.4% in August and 46% in July. According to the Ministry of Labor, the number of unemployed reached 3.7 million in September.
The firm said that unemployment is likely to increase further in the coming months, albeit at a slower pace. On average, the firm expects the unemployment rate to exceed 18% in 2009 and reach nearly 21% in 2010.
Further, the increase in unemployment combined with the payment of the 420-euro unemployment subsidy is likely raise public deficit, with shortfall estimated to make up nearly 10% on GDP in 2009.
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