Wednesday, German exports dropped for the fifth straight month in February, but the pace of decline was less than expected, while manufacturing orders declined more than anticipated. Elsewhere, Germany's government expanded the size of its car-scrapping scheme.

Eurozone

Germany's Federal Statistical Office reported that calendar and seasonal adjusted exports decreased 0.7% month-on-month in February, subsequent to 7.4% decline in January. Meanwhile, economists had forecast a 3.3% decline. On an annual basis, overseas sales plunged 23.1% in February versus a 23.2% fall in January.

On a monthly basis, imports fell for the fifth straight month with February recording a 4.2% decline after a slower 1.8% drop in January. On an annual basis, imports were down 16.4% following a 13.7% decrease in the prior month. The annual fall in imports extended for the fourth straight month.

The foreign trade balance showed a surplus of EUR 8.7 billion in February, down from EUR 17.1 billion surplus recorded in the same month of the previous year.

In a separate report, the German statistical office said there were 2,444 enterprise insolvencies and 7,901 consumer insolvencies in January. Insolvency courts registered a total of 12,668 in January.

Federal Ministry of Economics and Technology said that orders to German manufacturing firms fell 3.5% month-on-month in February after falling 6.7% in January. Economists had expected a 2.1% fall for February. Orders fell for the sixth straight month.

On an annual basis, orders plunged 38.2% in February following 36.8% drop in January, while the consensus forecast was for a 36.5% decline. It was the tenth consecutive month of decline in orders.

Elsewhere, the German government more than tripled its car-scrapping bonus scheme to EUR 5 billion from an initial EUR 1.5 billion. The scheme is expected to benefit nearly two million people, an increase from the initial estimate of about 600,000. The scheme was to end on May 31, but now extended till the end of the year.

The Bank of France said its business sentiment indicator for industries rose to 73 in March from February's revised reading of 71. Meanwhile, the business sentiment indicator for services stood at 76 in March 2009, after 78 in February. Moreover, the central bank said its monthly indicator of economic activity signals that the economy would contract 0.8% in the first quarter, sharper than a 0.6% fall estimated in February.

Elsewhere, the French customs office said trade deficit widened to EUR 4.11 billion in February from a revised EUR 3.7 billion deficit in January.

Finland's gross domestic product declined a seasonally adjusted 1.76% month-on-month in January, following a 1.29% fall in December, the Statistics Finland said.

Separately, the Statistics Finland said the general government's EMU debt grew by EUR 6.4 billion to EUR 62.14 billion in the fourth quarter from EUR 55.72 billion in the third quarter.

The General Secretariat of the National Statistical Service of Greece announced that the consumer price index or CPI rose 1.3% year-over-year in March, slower than the 1.6% increase in the previous month. On a monthly basis, the CPI increased 2% in March, after falling 0.9% in February

Rest of Europe

The economy of Great Britain contracted by an estimated 1.5% in the first three months of 2009, according to a study released by the National Institute of Economic and Social Research. The Institute also said the decline in output is very similar to the recession that began in the summer of 1979.

An index measuring consumer confidence in the United Kingdom tied a record low score of 41 in March, the Nationwide building society said. That was lower than analyst expectations for a score of 45 after the index came in at 43 in February.

A report by the British Retail Consortium said UK's BRC Nielsen Shop Price annual inflation rate stood at 2% in March, up from 1.9% in February. This was the fourth consecutive month of rising shop price inflation. On a monthly basis, the shop price index rose 0.4% in March.

Switzerland's Federal Council nominated Philipp Hildebrand as the new President of the Swiss National Bank. He will assume office on January 1, 2010 after the retirement of Jean-Pierre Roth.

Statistics Norway announced that CPI rose 2.5% year-over-year in March, marking the same pace as in the previous month. On a monthly basis, the CPI increased 0.1% in March, slower than the 0.8% increase in the previous month. Producer prices in Norway fell 0.3% year-on-year in March, reversing a 0.2% rise in February.

The Czech Republic's jobless rate increased to 7.7% in March from 7.4% in February, the country's Ministry of Labor and Social Affairs said in statement.

Hungary's Central Statistical Office said in a preliminary report that the trade surplus stood at EUR 279 million in February, after a deficit of EUR 194 million in January.

A report by the Turkish Statistical Institute showed that the industrial production dropped 23.7% year-on-year in February, after a 21.3% fall in the previous month.

Denmark's current account deficit stood at DKK 0.026 billion in February, narrowing from DKK 3.9 billion deficit in January, the Statistics Denmark said.

Industrial production in Romania rose 11% month-on-month in February, following a revised 0.4% fall in January, the National Institute of Statistics said.

Iceland's central bank lowered its key interest by 150 basis points to 15.5%. In March, the central bank had lowered the rate by 100 basis points to 17% from a record 18%, where it had remained since October 2008.

Lithuania said consumer prices increased 7.7% year-on-year in March, at a slower pace compared to an 8.7% rise in the previous month.

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