Graham Bishop.com

EZA 913 Germany / euro area: German exports helping euro area growth (not sapping it)

The sharp swings in exports in Germany during the last twelve months have filtered through to both German and euro area growth.
The German trade surplus with the rest of the euro area has narrowed much more hesitantly than that with “ex euro” economies, implying that the euro area has been a stabilising force for Germany.
Conversely, Germany has sapped demand from the rest of the euro area, aggravating the downturn there.
But this effect seems to have unwound, since ex euro exports have recovered much faster than those to the euro area, explaining part of the positive contribution Germany made to euro area growth in 2Q and in 3Q09.
Going forward German exports are bound to boost growth also in the rest of the euro area, rather than reduce it.

Asset conclusions: growing trade interdependence within the euro area underpins synchronised movements in equities.

Please see attached the latest report/analysis from Michael Clauss.

Dr Michael Clauss: Germany Politics / Economy / Equities Sectoral Analysis
Tel: +49 89 64254046

Discussion Partners:

John Arrowsmith: ECB / Regulatory

Tel: +44 7720 59 1726

Dr Michael Clauss: Germany Politics / Economy / Equities Sectoral Analysis
Tel: +49 89 64254046

Jacques Lafitte: France Politics / Brussels
Tel: +32 473 934 664