Eurozone Exports Rose in August, Easing Brexit Fears
October 14 2016 - 5:10AM
Dow Jones News
The eurozone's trade surplus with the rest of the world widened
during August for the first time since April, a fresh sign that the
U.K.'s decision to leave the European Union has had little
immediate impact on growth across the continent.
Policy makers had feared that the shock inspired by Britain's
unprecedented decision would cause consumers and businesses to
delay spending, and that exports to the eurozone's second-largest
overseas market would be hit by the sharp depreciation of the pound
against the euro.
But the European Union's statistics agency on Friday said that
on a seasonally adjusted basis, exports of goods from the currency
area rose by 2.3% from July, more than reversing a fall in that
month, while imports rose by 0.9%, leading to an increase in the
trade surplus to €23.3 billion ($25.7 billion) from €20.8 billion
in July. Without the seasonal adjustment, the surplus widened to
€18.4 billion from €11.2 billion a year earlier.
A widening of the trade surplus was the main driver of economic
growth for the eurozone during the three months to June, as
spending by households and businesses slowed. Overall, economic
growth edged down to 0.3% from 0.5% in the first quarter.
The widening of the surplus in August after a narrowing in July
is consistent with other indications that growth continued at the
same modest pace in the third quarter, and follows figures released
Wednesday that showed a pickup in industrial production during the
month.
However, policy makers have warned that it is too early to
conclude the Brexit vote won't have any impact on the eurozone's
recovery. Currency movements can take many months to affect flows
of exports and imports, while there have been some recent signs
that the prices paid by U.K. consumers are on the rise.
Consumer-products giant Unilever PLC is raising its U.K. prices
for everything from mayonnaise to shampoo, citing rising commodity
costs in dollars, which coupled with the sharp decline in the pound
have raised the cost of imported ingredients.
Write to Paul Hannon at paul.hannon@wsj.com
(END) Dow Jones Newswires
October 14, 2016 05:55 ET (09:55 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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