Euro Zone Exports Rise For Third Straight Month
03/16/2012 | 06:56am-- Euro-zone exports rise for third straight month in January
-- Data supports hopes manufacturing will support economy
-- Trade deficit wider than expected as imports rebound
LONDON -- A third straight rise in euro-zone exports in January
bolstered hopes that manufacturers will help the region avoid a severe
downturn, while a rebound in imports offered a tentative sign domestic
demand is on the mend.
The 17-nation currency bloc posted a trade deficit of EUR7.6 billion
in January, the European Union's statistics agency Eurostat said Friday.
That's smaller than the EUR16.1 billion gap recorded in January 2011
but more the EUR7.0 billion shortfall predicted in a survey of analysts
by Dow Jones Newswires.
The euro zone typically posts trade deficits in winter months due to
large imports of fuel and energy. The winter of 2010/2011 was
particularly cold, and the EUR16.1 billion trade deficit for that
January was the highest on record.
Exports in January 2012 rose 1.3% in seasonally adjusted terms,
Eurostat said. That is the third straight monthly increase, and will
raise hopes that strength in the region's manufacturing base will
support the economy and limit the current downturn.
Data last week showed Germany, the region's biggest economy and
manufacturing heartland, posting a strong rise in exports in January of
2.3%.
"The third successive rise in euro-zone exports in January boosts
hopes that improving foreign demand will help the euro zone return to
growth sooner rather than later," said Howard Archer, economist at IHS
Global Insight, a consultancy. He said recent weakness in the euro will
help exporters.
The bloc's economy contracted in the final three months of 2011, with
six of its 17 nations already in recession--defined by two consecutive
quarters of falling output.
A growing number of European leaders are calling for a renewed focus
on fostering trade and other sources of growth, to offset cuts in
government spending and help the region escape its long-running
sovereign debt crisis. The heads of 12 governments including Italy and
Spain, the third- and fourth-largest euro-zone economies, wrote to the
European Commission in February calling for "concrete steps" to
modernize the economy, including new trade deals with other countries
around the world.
Imports to the euro zone in January jumped 2.4%, rebounding from four
straight months of decline, Eurostat's figures showed. Those figures
have been adjusted to exclude the effects of high energy imports,
typical in the winter.
The rise in imports was one cause for the trade deficit being wider
than expected in January. But Archer said it also offers a tentative
sign that consumer demand--crucial to the euro zone's economic
recovery--may be firming.
"This [rise] raises hopes that domestic demand may be stabilizing overall across the euro zone," he said.
But he noted "it is likely that import values were pushed up by higher prices."
-By Alex Brittain, Dow Jones Newswires; +44 20 7842 9203; alex.brittain@dowjones.com
