- Jens Kramer, an economist at NordLB
German factory orders declined more than expected in December amid a weak demand at home and in other Euro zone countries. According to the Economy Ministry, orders decreased 0.7% in the reported month from November, when they climbed 1.5%. Domestic orders declined 2.5%, while demand from the Euro zone countries plunged 6.9%. At the same time, orders from outside the Euro bloc jumped 5.5%. The government recently downgraded its growth outlook for the German economy to 1.7% this year from 1.8% due to concerns about weakening growth abroad and global political tensions. In 2015, the Euro zone's biggest economy expanded 1.7%.
At the same time, in the Euro area's second biggest economy trade deficit declined last year to the lowest level since 2009 mainly due to cheaper oil imports. With oil and other natural resource imports accounting for about 75% of France's shortfall, the trade gap contracted to 45.67 billion euros last year, down from 58.3 billion in 2014. Supported by a weaker Euro, exports surged 4.3% with aircraft and car sales particularly robust, while imports increased only 1.2% amid low energy prices. Separately, the Bank of France reported that the current account balance showed a deficit of 700 million euros in December following a 1.5 billion shortfall in November.
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