The external trade surplus amounted to EUR 440.0mn in August and declined by 21.4% y/y, the statistical office (KSH) published preliminary figures. On a cumulative basis, the surplus reached EUR5,574.2m and was down by 16.5% y/y in Jan-Aug. We think that the deterioration in the foreign trade position was due partly to worse terms of trade, both in August and in the year so far. In August in particular, the surplus declined y/y due to strong import growth.
Imports rose by 13.0% y/y in August, outperforming the 10.3% y/y growth in exports. Both import and export growth accelerated from the previous month but we think this was largely the result of the low base related to summer holidays in the industry. The high import growth was still generally in line with the average increase since the beginning of the year so we consider it indicative for maintained momentum of domestic demand. On the other hand, export growth was relatively strong compared to the average increase in the year so far. We think it was related to the resumption of operations by industrial companies after summer holidays and we expect the robust export growth to continue in the next months, supported by favorable external market conditions.
The KSH is due to publish the detailed external trade data for August on Nov 2.