Germany’s Export Growth Tops Expectations

Germany’s exports rebounded at a faster-than-expected pace in September, despite signs of mild recession, data from Destatis revealed Friday.

Exports grew 1.5 percent month-on-month, in contrast to August’s 0.9 percent fall. Shipments were forecast to grow only 0.3 percent.

At the same time, imports growth accelerated to 1.3 percent from 0.1 percent a month ago, while economists had forecast stagnation.

Consequently, the trade surplus increased to a seasonally adjusted EUR 19.2 billion from EUR 18.7 billion in the previous month.

On a yearly basis, exports and imports grew the most in four months.

Exports gained 4.6 percent year-on-year after falling 3.6 percent in August. Imports advanced 2.3 percent, partially offsetting the previous month’s 3 percent decline.

The unadjusted trade surplus totaled EUR 21.1 billion versus EUR 18.2 billion in the same month last year.

Germany’s exports to EU countries increased 5.6 percent, and imports from those countries by 2.1 percent. Shipments to euro area climbed 4.8 percent, while the value of the goods imported from those countries grew only 1.4 percent.

Data showed that the current account of the balance of payments showed a surplus of EUR 25.5 billion compared to EUR 18.9 billion in September 2018.

Other indicators have suggested a mixed outlook for the German exports.

Factory order data released earlier this week showed that foreign demand increased 1.1 percent month-on-month in September.

However, the purchasing managers’ survey showed that new export business in the private sector remained particularly weak in October.

The German government’s independent economic advisers, early this week, slashed the growth forecast but said a severe recession is unlikely.

Advisers lowered growth outlook for 2019 to 0.5 percent from 0.8 percent and the projection for next year to 0.9 percent from 1.7 percent.

The government also forecast 0.5 percent expansion for 2019 and 1 percent growth for 2020.

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