For clues about where European RMBS performance is headed, Barclays Bank analysts are looking at jobless rates.

And what they see is pretty bleak.

In a commentary today, the analysts point out that the 11.7% unemployment posted in the Eurozone for October is a record high (see table further below).

Among the countries with the highest portion of people on the dole are Spain (26.2%) and Greece (25.4%). The heavyweight economy of Italy is also trending upward as unemployment there reached 11.1% from 10.8% in September.

“Unemployment will remain the key concern for European RMBS performance through 2013 and beyond,” Barclays analysts said. “The protection for investors will be the continued use of forbearance measures by lenders to assist those in need.”

An example of this is the recent two-year moratorium on repossessions of homes owned by Spanish borrowers who fulfill certain “financial hardship” criteria.

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