Euro Zone GDP And Unemployment Rates

Daily Forex Fundamentals | Written by ecPulse.com | Jan 08 10 08:11 GMT |

Dear reader, the end of the first economic week in 2010 is here as the euro zone is releasing major economic data regarding economic growth and labor market conditions while the largest economy contributing to growth in the euro zone, Germany, released its current account. First on our calendars, Germany's current account for November was released at 18.1 billion a rise from both the revised previous reading of 11.1 from 11.0 billion and the expected 10.8 billion. Trade balance for November was also released at 17.4 billion higher than the revised prior surplus of 13.4 from 13.6 billion which is better than the projected 12.5 billion. Taking the data into details we see that imports fell to -5.9% from the revised previous reading of -2.9% from -2.4% which is worse than the predicted 1.3%, while exports slipped to 1.6% from the revised prior reading of 1.9% from 2.5% which is better than the forecasted 0.8%. As exports slipped will hurt euro zone economic growth because the euro zone is an export dominated economy as they depend heavily on exports for growth, yet as a result of the global recession and crippled demand, exports have been heavily pressured. The major highlight of the day, euro zone will release its GDP third quarter final reading showing that it will remain unrevised at 0.4% while on the year the nation will continue to contract by 4.1 percent. The euro zone expanded during the third quarter as a result of Germany boosting growth levels especially as they expanded in the second quarter by 0.4%, and this positively impacted the euro zone helping the contraction narrow the second quarter contraction to -2% from first quarter contraction of 2.5%, which was the worst reading since 1959. The key sectors that boost growth levels in the euro zone, have been recovering in the past year, and this is positively affecting economic growth of-course alongside the incentive plans applied by the European Central Bank, after they took interest rate down to historical low levels at 1.00% while they are using 60 billion euros to buy governmental bonds to provide liquidity to markets. One of the main factors that are undermining growth prospects in the euro zone is the high unemployment rates; today we see that the zone will release the rates showing that in December they rose to 9.9% from 9.8%, which was the highest in nearly 11 years. The weak labor market is one of the core problems in the euro zone, because even when the region does prosper accurately and is out of recession, it will take some time before we see lower unemployment rates as industries lately have been facing lower net income while others have shut down from the worst economic period since WWII. The European stock market once again ended the session mixed as we saw the DJ Euro Stoxx 50 declined 2.32 points or 0.08% to 3007.34, CAC 40 rose 7.13 points or 0.18% to 4024.80 points while the DAX dipped 14.97 points or 0.25% to 6019.36 points. Ecpulse disclaimer: The content of ecPulse.com and any page in the website contain information for investors/traders and is not a recommendation to buy or sell currencies, stocks, gold, silver & energies, nor an offer to buy or sell currencies, stocks, gold, silver & energies. The information provided reflects the writers' opinions that deemed reliable but is not guaranteed as to accuracy or completeness. ecPulse is not liable for any losses or damages, monetary or otherwise that result. I recommend that anyone trades currencies, stocks, gold, silver & energies should do so with caution and consult with a broker before doing so. Prior performance may not be indicative of future performance. Currencies, stocks gold, silver &energies presented should be considered speculative with a high degree of volatility and risk