FT Alphaville " Turning German (or trying to) Charts, charts, charts, from Credit Suisse at the end of last week. They're reminders of a perhaps underrated story - of interest again as it seems German demand is staying weak. It's the decline in eurozone imports - because of the decline in demand in the periphery but also because Germany keeps on operating surpluses - and the latest in what this is doing to the world economy. Eurozone exports by contrast are relatively pootling along, so Credit Suisse don't see a shock from the Chinese slowdown. It may be vice versa: We think that sharp, crisis-induced, rise in the euro area's current account balance - worth around two percentage points of euro area GDP in the past nine months - has generated a significant negative shock to the global economy. And, as the charts above show, most regions have borne the brunt. Speaking of the current account stuff - we thought we'd share this reminder from David Watts of CreditSights, when it comes to Spain's adjustment. After all it's fair to say Spain is winning plaudits for reducing its current account deficit - now the smallest since 1999, etc - therefore, it'll be interesting to see how this factors into negotiations for a full bailout in the coming weeks. But as Watts noted back in August, the trade part of the deficit is no longer the big story. Remaining are factor payments, or in other words Spanish banks" interbank liabilities outside Spain - for which a continued reduction in domestic wages would not be unambiguously helpful. Related links: This crude old eurozone crisis - FT Alphaville Internal devaluation, inflation, and the euro - Paul Krugman This entry was posted by Joseph Cotterill on Monday, September 24th, 2012 at 17:15 and is filed under Capital markets. Tagged with current account, eurozone, Spain, trade.