Eurozone trade surplus falls

The eurozone's trade surplus fell in April as imports recovered from a decline a month before, but exports also held up well despite a strong euro and slower growth in the United States, data showed on Friday.
The eurozone's seasonally unadjusted trade surplus fell to 1.8 billion euros ($2.4 billion) from a revised 7.6 billion in March, the European Union's statistics office said. Seasonally adjusted, the surplus in the 13 countries using the euro fell to 3.5 billion from 5.4 billion euros in March, after imports rose 2.2 percent in April against the previous month and exports increased 0.6 percent.
"The ongoing resilience of eurozone exports is likely to reinforce the European Central Bank's belief that regional growth is strong enough to warrant a further hike in interest rates in September," said Howard Archer, economist at Global Insight.
Rising ECB rates have strengthened the euro against the US dollar and the Japanese yen, prompting complaints from the eurozone's second-biggest economy, France, that the exchange rate was hurting its exports. Economists said the strength of the euro may have played a role in the April deterioration of the external trade balance.
However, an economic slowdown in the United States, the eurozone's second-biggest trading partner after Britain, was a more important factor. After months of steady appreciation, the euro hit all-time highs against the dollar at the end of April and firmed to a record against the yen earlier in June.
The only two countries to which eurozone exports fell year-on-year in the first quarter of 2007 were the United States and Japan, with a 2 percent and 1 percent decline respectively.
French imports jumped 10.1 percent in April on a seasonally adjusted basis against March and exports declined 0.4 percent, depressing the country's trade surplus to 0.3 billion euros from 1.3 billion the previous month. Germany was the biggest contributor to the overall eurozone surplus with a 6.0 billion euro positive balance.
The trade surplus in manufactured goods rose to 56.1 billion from 53 billion euros. Net trade will probably neither hamper nor boost the now domestically driven economic growth in the euro area in the second quarter after slowing it down in the first three months, economists said.