EUROPEAN INFLATION: EZ Final HICP Reaffirms Services Deceleration in Flash

EURIBOR FIX - EMMI/Bloomberg.

• EUR001W 2.6390 0.0260
• EUR001M 2.6160 0.0120
• EUR003M 2.5100 -0.0120
• EUR006M 2.4890 -0.0250
• EUR012M 2.4240 -0.0140

• The Eurozone trade surplus printed close to consensus in December, at a seasonally adjusted E14.6bn (cons E14.5bn) after an upward revised E13.3bn (originally E12.9bn).
• The larger surplus was for the ‘wrong’ reasons, coming as the decline in imports (-0.8% M/M) outstripped that of exports (-0.2% M/M).
• This story was exaggerated for the EU as a whole, with a surplus widening from E10.1bn to E12.9bn (sa) as imports fell -1.2% M/M vs exports 0.1% M/M.
• Turning to the broader EU nsa data, extra-EU export growth stood at 3.7% Y/Y vs 3.9% Y/Y for extra-EU imports, whilst intra-EU trade was more subdued at just 1.6% Y/Y.
• One of the fastest growing areas of exports was for chemicals & related products (14.3% Y/Y), as we’ve noted one of the more vulnerable areas to US tariffs considering its magnitude within EU-US trade.
• By country, trade with the US was mixed the month ahead of Trump’s inauguration, with overall exports rising 5.6% Y/Y vs overall import growth of -10.8% Y/Y. 

WTI futures have pulled back from last week’s high and price has again traded below the 50-day EMA - at $72.08. Attention is on $70.43, the Feb 6 low. It has been pierced, a clear break would undermine a bullish theme and confirm a breach of the 50-day EMA. This would strengthen a bearish threat and open $68.05, the Dec 20 ‘24 low. Key S/T resistance has been defined at $75.18. A move above this level is required to reinstate a bull theme. A bull cycle in Gold remains in play and the yellow metal continues to trade closer to its latest highs. Recent gains once again confirm a resumption of the uptrend and maintain the bullish price sequence of higher highs and higher lows. Moving average studies are in a bull mode position too, highlighting a dominant uptrend. Sights are on the $2962.2, a Fibonacci projection. The first key support to watch is $2826.5, the 20-day EMA.

• WTI Crude up $0.12 or +0.17% at $70.86
• Natural Gas down $0.09 or -2.42% at $3.637
• Gold spot up $20.92 or +0.73% at $2903.75
• Copper down $3.3 or -0.7% at $468
• Silver up $0.35 or +1.08% at $32.4489
• Platinum up $3.97 or +0.4% at $988.13