Eurozone Exports Fall For Second Month

Eurozone exports declined for the second consecutive month in October, suggesting little support to the economy from foreign demand at a time when domestic consumption is restrained by government spending cuts and high unemployment.

Exports slipped by a seasonally adjusted 1.4 percent from a month ago, when it dropped 1.3 percent, a report published by Eurostat showed Monday. Imports, on the other hand, grew only 0.6 percent, following a 3 percent drop in August.

The decline has raised concern that net trade will not come to the Eurozone's rescue again in the fourth quarter, IHS Global Insight's Chief European economist Howard Archer said.

Year-on-year, exports from the region climbed 14 percent annually in October, much faster than a 1 percent gain in the previous month. Imports grew 7 percent, reversing September's 4 percent slump.

The trade surplus declined to a seasonally adjusted EUR 7.9 billion in October from EUR 11 billion in the preceding month.

On an unadjusted basis, the merchandise trade showed a surplus of EUR 10.2 billion in October, which was larger than a surplus of EUR 9.5 billion recorded in September. Economists had forecast the surplus to fall to EUR 9 billion.

The 27-member European Union saw its goods trade with the rest of the world yielding a deficit of EUR 9.4 billion in October compared with a EUR 12.5 billion deficit in September.

A separate report from Eurostat showed that Eurozone labor costs rose at a pace of 2 percent annually in the third quarter, after growing 1.9 percent in the second quarter.

According to the recent Purchasing Managers' survey data, the rate of job losses eased in December, hitting the lowest since August. The downturn in Eurozone slowed as the German private sector returned to growth, while contractions in the rest of the region remain worrying.