Eurozone Exports Jump, Boosting Trade Surplus

 
   By Paul Hannon 

        The eurozone's trade surplus widened in September as exports surged, an indication that a weakening euro may be coming to the currency area's rescue as domestic demand remains anemic.
        The European Union's statistics agency on Friday said the eurozone economy grew at an annualized pace of 0.6% in the third quarter, a slight acceleration from the second, with France and Germany returning to growth.
        Figures released by Eurostat on Monday suggested exports may have helped boost activity toward the end of the quarter, with the eurozone recording a surplus in its trade in goods with the rest of the world of 18.5 billion euros ($23.17 billion), up from EUR10.8 billion in the same month of 2013.
        Seasonally adjusted figures recorded a 4.2% jump in exports during September, which outpaced a 3.0% increase in imports. Exports have been volatile in recent months, but that sharp rise may reflect a belated boost from a weakening currency, which makes goods manufactured in the eurozone less expensive on world markets.
        The euro has fallen steadily against the dollar since May, when the European Central bank first indicated it was willing to provide additional stimulus to boost flagging growth and a very low inflation rate. It subsequently cut its key interest rates in June and September, and has also offered cheap, four-year loans to banks, and begun to buy bonds issued by the private sector. Many investors expect the central bank to provide further stimulus in coming months, possibly culminating in large-scale purchases of government bonds known as quantitative easing.
        The rise in exports during September was broad based. Germany led the way with an increase of 7.9%, while France recorded a rise of 4.0% and Italy an increase of 6.8%.
        The pickup also came despite a continued drop in exports to Russia, reflecting tensions between that country and the European Union over the future of Ukraine, which have led to reciprocal trade and financial sanctions.
        Eurostat said that for the eight months to August--the most recent month for which figures are available--eurozone exports to Russia were down 15% from the same period of 2013, while imports from Russia declined 8%, the result being a slight rise in Russia's trade surplus with the currency area.
        That drop in trade doesn't seem to be entirely due to sanctions, since it began well before the first round of penalties were announced. Instead, the decline in exports largely stems from the sharp slowing of the Russian economy in 2013 and through 2014.
        Write to Paul Hannon at paul.hannon@wsj.com
        (END) Dow Jones Newswires

        November 17, 2014 05:00 ET (10:00 GMT)