The eurozone seasonally adjusted current account balance was **€14.6bn** in December. This was above the forecast of **€9.2bn**.
The stronger-than-expected current account surplus in December 2025 is a **bullish** signal for the euro. At **€14.6bn** versus a **€9.2bn** forecast, it suggests the eurozone’s export sector was stronger than expected at the end of last year. This strength should be an important input in our currency positioning.
This view is supported by the latest manufacturing PMI data for January 2026. PMI surprised to the upside, rising to **51.2**, above the forecast **49.8** (which implied contraction). That suggests the export strength seen in December is continuing into the new year. With core inflation still elevated at **2.6%**, the case for a stronger euro is growing.
We should consider **buying euro call options**, focused on **EUR/USD**, over the next few weeks. The data points to more resilience than the market expected after the slowdown in Q3 2025. Look at options expiring in **March or April 2026** to capture a potential move higher.
The stronger export backdrop also supports a **bullish view on European equities**, especially German and French companies that depend on global trade. We can express this by buying **Euro Stoxx 50 futures** or **call options**. In past periods of strong exports—such as during the 2021 recovery—export-heavy indices have often rallied.
This data also argues for revisiting expectations for the European Central Bank’s policy path. Market pricing for near-term rate cuts now looks too dovish and may unwind. We should adjust interest-rate derivative positions, since short-term rates such as **Euribor** may be near a floor or could move higher in the near term.
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