Disappointing German Import and Export Data Sends Euro Lower

carrEuropean stock markets are trading lower on Tuesday and the euro is facing downward pressure after disappointing German import and export results were reported for May and global investors remain cautious ahead of second quarter U.S. corporate earnings results that begin later in the day with aluminum maker Alcoa.

Germany has the strongest economy in Europe, the fourth-largest by nominal GDP in the world, and relies heavily on exports to help drive  its economy.

On Tuesday the Federal Statistics Office reported that seasonally adjusted German exports fell in May by 1.1 percent and imports declined by 3.4 percent, the sharpest decline since November 2012, renewing concerns about the vibrancy of Europe’s largest economy which comes on the heels of the European Central Bank (ECB) signaling last week a greater willingness to use accommodative actions by keeping interest rates at historic lows and possibly beginning an asset purchase program to help stabilize the economy and reverse the trend of low inflation that threatens the 18 member euro currency bloc.

The inflation rate in the 18 member Euro area for June was only 0.50 percent.

-Johnathan Schweitzer

 

 

 

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