In Germany, the trade balance showed a contracting surplus in December. The trade surplus dropped from a revised 9.9B in November to 6.9B in December. Both imports (-4.1% M/M from -5.8% M/M) and exports (-3.7% M/M from -10.8% M/M) declined. In the coming months, the trade surplus is expected to continue its trend lower as exports are set to decline more than imports.
Bank of France business sentiment improved from an upwardly revised 67 in December to 70 in January. The details show a significant improvement in actual production (-1 from -25) and total orders (-13 from -30), while order level deteriorated. The Bank of France said the French economy will slip into its first recession in 16 years in the first quarter of this year.
