European Trade Balance Sees First Deficit In 11 Months

Euro-Zone Trade Balance (JUL)
(Balance) (s.a.)
Actual: 4.6B -0.6B
Expected: 7.0B 4.0B
Previous: 7.6B (R-) 4.4B (R-)
The Euro Zone’s physical trade account reported interesting and divergent results between its adjusted and unadjusted numbers. For an unadjusted July report, the surplus was still in place with a 4.6 billion euro number though it was well below the previous month’s figure and the forecasted 7.0 billion euro positive gap. Considering the usual seasonal adjustments, the balance was actually turned to a 600 million euro deficit, the first shortfall since August of 2006 and a considable plummet from June’s 4.4 billion euro figure. The unfavorable shift in the balance is the cumulate effects of steady and strong demand from Europeans for foreign goods, a global deceleration in growth trends and the euro at a record high. With the european currency printing highs against the US dollar and Japanese yen, among other currencies, competitive pricing continues to slip away from European manufacturers. One noteable, isolated trade account was the deficit the Euro Zone holds with China. The shortfall surged 22 percent over the first six months of the year on a 78.5 billion euro jump in imports.
In the minutes after the release, the euro was little changed with EURUSD holding its choppy price pattern around 1.3865.