Euro-area exports fell in September as the region’s economy slipped into a recession for the second time in four years.
Exports from the 17-nation bloc declined a seasonally adjusted 1.1 percent from August, when they gained 3.3 percent, the European Union’s statistics office in Luxembourg said today. Imports dropped 2.7 percent.
The trade surplus widened to 11.3 billion euros ($14.4 billion) from a revised 8.9 billion euros in the previous month.
The sovereign debt crisis in the euro area is taking its toll on demand as governments impose budget cuts to narrow their fiscal deficits.
Gross domestic product in the monetary union fell 0.1 percent in the third quarter after a 0.2 percent decline in the previous three months. Greece’s economy has contracted for 17 straight quarters and the Portuguese economy completed its second year of quarterly contractions.
“The situation is getting worse in many European countries,” said Thilo Heidrich, an economist at Deutsche Postbank AG (DPB) in Bonn, after today’s report.
“Everything points to a further contraction. I don’t expect the economy in the euro area to grow again before mid-2013.”
Exports from Germany, Europe’s largest economy, fell 1.5 percent in September, while imports dropped 2.5 percent, today’s report showed.
Italy and Spain reported export declines of 0.8 percent and 1.2 percent, respectively. Shipments from France increased 1.6 percent in the month.
The euro fell after the report and traded at $1.2736 at 11:10 a.m. in Frankfurt, down 0.4 percent today. The Stoxx Europe 600 Index dropped 0.5 percent to 264.31. That’s the lowest since Aug. 2.
Shrinking Demand
The European Commission on Nov. 7 forecast that the euro- area economy will contract 0.4 percent this year and expand 0.1 percent next year. It halved its 2013 forecast for growth in Germany to 0.8 percent, citing the debt crisis and weaker export demand.
Siemens AG (SIE), the biggest engineering company in Europe, on Nov. 8 unveiled a 6 billion-euro savings plan to restore profitability, acknowledging it was slow to react to shrinking demand.
Chief Executive Officer Peter Loescher said job losses will be inevitable. Deutsche Post AG (DPW), Europe’s largest postal service, said on Nov. 8 that third-quarter profit fell 6.5 percent as a pay increase caused spending to rise.
“We see as well a slowdown of import and export volumes,” Chief Executive Officer Frank Appel said in an interview with Bloomberg Television.
“The German economy is not as strong as it has been in the past two years.” Global Demand With the economy in the euro area slowing, exporters are turning increasingly to faster growing areas outside Europe.
Bayerische Motoren Werke AG, the world’s biggest maker of luxury cars, stands by its plans to increase 2012 profit, Chief Financial Officer Friedrich Eichiner said on Nov. 6.
The Munich- based company posted third-quarter earnings that beat analyst expectations, helped by growth in the U.S. and Asia.
“China and the United States are the biggest hopes for European exporters,” said Ulrike Kastens, an economist at Sal. Oppenheim in Cologne. “As for the euro area, everything points to a further deterioration of the economic situation.”
In the U.S., consumer spending, the biggest part of the economy, and an improving housing market are leading the expansion amid rising confidence, better employment prospects and healthier household finances.
In China, factory output and retail sales exceeded forecasts in October and exports rose the most since May.
bloomberg.com
Exports from the 17-nation bloc declined a seasonally adjusted 1.1 percent from August, when they gained 3.3 percent, the European Union’s statistics office in Luxembourg said today. Imports dropped 2.7 percent.
The trade surplus widened to 11.3 billion euros ($14.4 billion) from a revised 8.9 billion euros in the previous month.
The sovereign debt crisis in the euro area is taking its toll on demand as governments impose budget cuts to narrow their fiscal deficits.
Gross domestic product in the monetary union fell 0.1 percent in the third quarter after a 0.2 percent decline in the previous three months. Greece’s economy has contracted for 17 straight quarters and the Portuguese economy completed its second year of quarterly contractions.
“The situation is getting worse in many European countries,” said Thilo Heidrich, an economist at Deutsche Postbank AG (DPB) in Bonn, after today’s report.
“Everything points to a further contraction. I don’t expect the economy in the euro area to grow again before mid-2013.”
Exports from Germany, Europe’s largest economy, fell 1.5 percent in September, while imports dropped 2.5 percent, today’s report showed.
Italy and Spain reported export declines of 0.8 percent and 1.2 percent, respectively. Shipments from France increased 1.6 percent in the month.
The euro fell after the report and traded at $1.2736 at 11:10 a.m. in Frankfurt, down 0.4 percent today. The Stoxx Europe 600 Index dropped 0.5 percent to 264.31. That’s the lowest since Aug. 2.
Shrinking Demand
The European Commission on Nov. 7 forecast that the euro- area economy will contract 0.4 percent this year and expand 0.1 percent next year. It halved its 2013 forecast for growth in Germany to 0.8 percent, citing the debt crisis and weaker export demand.
Siemens AG (SIE), the biggest engineering company in Europe, on Nov. 8 unveiled a 6 billion-euro savings plan to restore profitability, acknowledging it was slow to react to shrinking demand.
Chief Executive Officer Peter Loescher said job losses will be inevitable. Deutsche Post AG (DPW), Europe’s largest postal service, said on Nov. 8 that third-quarter profit fell 6.5 percent as a pay increase caused spending to rise.
“We see as well a slowdown of import and export volumes,” Chief Executive Officer Frank Appel said in an interview with Bloomberg Television.
“The German economy is not as strong as it has been in the past two years.” Global Demand With the economy in the euro area slowing, exporters are turning increasingly to faster growing areas outside Europe.
Bayerische Motoren Werke AG, the world’s biggest maker of luxury cars, stands by its plans to increase 2012 profit, Chief Financial Officer Friedrich Eichiner said on Nov. 6.
The Munich- based company posted third-quarter earnings that beat analyst expectations, helped by growth in the U.S. and Asia.
“China and the United States are the biggest hopes for European exporters,” said Ulrike Kastens, an economist at Sal. Oppenheim in Cologne. “As for the euro area, everything points to a further deterioration of the economic situation.”
In the U.S., consumer spending, the biggest part of the economy, and an improving housing market are leading the expansion amid rising confidence, better employment prospects and healthier household finances.
In China, factory output and retail sales exceeded forecasts in October and exports rose the most since May.
bloomberg.com
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