Release Explanation: Measures the country’s exports minus its imports and its the largest component of a country’s balance of payments. An increase or decrease in the Trade Balance will help determine the future economic outlook and growth numbers in a region. It can influence all aspects of an economy as it is the way that region balances its books.
Trade Desk Thoughts: The Euro-area adjusted trade balance was released at -5.5B in January, less than expected. In January 2009 compared with December 2008, seasonally adjusted exports fell by 16.7% and imports by 8.1%.
An analysis of the trade balance over the last year shows that imports rose at a faster pace than exports mainly due to the energy component, which is also the biggest module of the trade balance. January was the seventh consecutive month in which the Euro-area ran a trade deficit, seasonally adjusted data.
Forex Technical Reaction: The release had no immediate effect on the currency market. Now, the euro trades near the Asian open price, after it fell almost 100 pips during the European session.