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A Strengthening Hand in the EU

The Euro Zone showed an improving current account surplus with the release of the January data according to the European Central Bank.  The EU-27 surplus rose to a record high $34.9 billion in January.  The current account balance is a broad measure of an economy’s international financial positive.  Think of it as cash flow.  What this mean is that the EU-17 is exporting more than it is importing, and currency is moving into the zone.  This is good news for them and for the US in that a stable/mildly expanding EU provides for markets for US goods and removes a financial threat to global stability.  A collapsing Europe is bad for everyone.

While the good news is found in Italy and Spain, it is primarily due to German-made goods being in demand globally.  France is still running a deficit, as is the USA. 

Lagging behind but still showing a favorable trend, US exports are increasing as our imports are holding essentially flat ($1.583 trillion and $2.267 trillion, respectively).   Exports are up 2.0% year-over-year while imports are down 0.4%.  A continuation of this trend would help strengthen our financial position as a nation and is good for our future. 

TAGS: The Economy
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