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Euro zone trade gap smaller than expected, Russia deficit surges

The euro zone swung to a large trade deficit in September from a small surplus a year earlier due to a surge in the costs of imported energy in the wake of Russia’s invasion of Ukraine, but the deficit was smaller than expected, data showed on Tuesday.

The European Union’s statistics office Eurostat said the seasonally unadjusted trade deficit of the 19 countries sharing the euro with the rest of the world was 34.4 billion euros ($35.7 billion) in September, against a 6.7 billion surplus 12 months earlier.

Economists polled by Reuters had expected the deficit to reach 44.5 billion euros in September.

Adjusted for seasonal factors, the trade gap was even slightly higher at 37.7 billion euros, though declining from 47.6 billion euros in August and 40.5 billion euros in July.

Detailed data for the euro zone was not available, but the wider European Union’s trade deficit with Russia, Europe’s main energy supplier, surged to 125.7 billion euros in the first nine months of the year from 44.3 billion euros in the same period of 2021. In the first eight months of this year, the deficit with Russia was 115.0 billion euros.

The trade gap with another energy producer Norway, with which the EU is seeking to replace Russia as an energy supplier, showed an even more spectacular jump to 70.8 billion euros in the nine months from only 4.4 billion euros the year before.

The EU’s deficit in energy trade rocketed to 491.4 billion in the first nine months of this year from 179.6 billion in the same period of 2021.

The trade gap with China, Europe’s biggest trading partner, almost doubled to 300.2 billion euros in the January-September period from 166.5 billion euros in the same period a year earlier.

The EU did record trade surpluses with the United States, Britain and Switzerland and for food and drink and manufacturing as a whole.
Source: Reuters (Reporting by Jan Strupczewski; editing by Philip Blenkinsop)

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