Export slowdown continues

Recent data from the external sector have confirmed that export growth has continued to slow. Indeed, the annual growth rate of export values fell to its lowest level in two and a half years in May. Admittedly, the recent fall in the euro should help exporters. At face value, the drop in the exchange rate over the last year suggests that annual export growth could soon reaccelerate to a very robust 25% or so. But continued falls in survey-based measures of firms’ export orders and the reasonably weak economic outlook in some of the region’s key export markets suggest that a sharp turnaround in export growth is very unlikely.