Commentary -Germany's unemployment rate rose to 8.6% in March as the global economic downturn continued to tighten its grip on Europe's largest economy.

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Germany's unemployment rate rises

Germany's unemployment rate rose to 8.6% in March as the global economic downturn continued to tighten its grip on Europe's largest economy.

The rate rose slightly from 8.5% in February, on an unadjusted basis.

In seasonally adjusted terms, the rate rose to 8.1% from 8%, official figures also showed. This equates to 3.4 million people, an increase of 69,000.

Unemployment rates have been rising across Europe, with the Spanish jobless rate the highest at more than 14%.

Weak economy

"The economic downswing is increasingly having an impact on the labour market," said Frank-Jurgen Weise at the Federal Labour Office.

The jump in the number of people out of work was bigger than many analysts had forecast.

"The increase was stronger than expected. That's obviously linked to the weaker economy. For the second quarter, we expect a slight decline and stabilisation after that," said Stefan Muetze from Helaba.

"But we have to assume that the job market will deteriorate further, well into 2010. At the end of 2009, we're likely to be near the four-million mark in unemployment figures," he added.