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Mixed signals on international trade in Q4 2014 as US dollar appreciated against major currencies

Total (seasonally adjusted, US dollar) merchandise imports in the G7 and BRIICS fell by 3.7% in the 4th quarter of 2014, compared with the previous quarter, partly reflecting a continued fall in oil prices. According to international trade statistics produced by the Organisation for Economic Cooperation and Development (OECD).

Merchandise exports also fell (by 3.0%) in US dollar terms, but this partly reflects the effects of an appreciating US dollar. When measured in local currencies, exports grew in most major economies In major euro area economies, both exports and imports fell strongly in the fourth quarter when measured in USD. When measured in euros, exports grew by 3.5% in France, 1.9% in Italy and 0.9% in Germany. Imports declined by 8.0%, 5.9% and 6.0%, respectively when measured in USD. Imports also fell in the United Kingdom (by 4.6%) while exports in USD and Sterling rose (by 1.2%. and 6.7% respectively).

Exports and imports fell in Canada (by 4.9% and 3.1% respectively) and Japan (3.8% and 6.4%), when measured in USD but Japanese exports rose by 5.8% in Yen. In the United States imports remained stable compared to the previous quarter, although exports contracted by 1.2%.

Among the BRIICS countries, Brazil experienced a significant fall in exports, measured in USD, in Q4 (by16.0%) and imports (by 8.3%), partly reflecting a collapse of key exports (iron ore and soybeans), resulting in Brazil’s largest trade deficit on record. Exports from Russia declined sharply (by 13.6%), reflecting a combination of EU sanctions and lower oil prices, while Russian imports dropped significantly  (by 10.7%) due to a combination of factors, in particular reciprocal import measures and  the collapse of the Rouble.

Exports grew slightly in China (by 0.4%) while imports fell (2.0%).Trade slowed sharply in Q4 in India with exports and imports down by 3.9% and 4.7% respectively.  Year on year, trade in US dollars in G7 and BRIICS countries combined grew modestly by 1.9% (exports) and 0.5% (imports).

In Germany and the United States, exports increased (by 4.0% and 2.8%), with imports up (by 2.2% and 3.4%, respectively). Japan recorded a trade deficit for the 4th consecutive year with exports and imports down by 3.5% and 2.5%. Among BRIICS countries, China’s exports and imports grew by 5.3% and 0.6% respectively.

Brazil recorded its first trade deficit since 2000 with exports and imports down 6.9% and 3.8% respectively.  Despite the strong contraction in exports Russia’s trade surplus increased marginally in 2014, as imports fell at a faster pace.

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