German exports take surprise hit in January

Photo: REUTERS

German trade fell 1% in January 2011, economists remain positive.

BRIAN ROHAN

Published: 2011/03/10 10:58:07 AM

German exports unexpectedly fell 1% in January, data showed on Thursday, in a slight setback for the key sector of Europe’s largest economy.


The trade surplus fell to €11,8bn from a revised 14,2 billion the month before, seasonally adjusted data from the Federal Statistics Office showed.


Economists remained upbeat, although they had forecast a surplus of €13,2bn and had expected exports to rise 0,7%.


"Despite today’s drop, exports should remain a reliable source for growth," said Carsten Brzeski from ING. "Demand from other eurozone countries is stronger than expected, despite fiscal austerity, and the strengthening US economy should also bring a welcome boost to German exports."


Germany has recovered faster than expected from a recession in 2009 that was its deepest since World War Two, and by the fourth quarter of last year it was growing 4% year-on-year.


The trade figures follow a run of strong data that have suggested Germany’s economic recovery is intact and broadening at a time when some eurozone peers are struggling under the burden of a sovereign debt crisis.


Ratings agency Moody’s cut Spain’s sovereign credit rating by a notch to Aa2 on Thursday and warned of further cuts.


Domestic demand fuelled a stronger-than-expected rise in German industrial orders in January.


Germans’ appetite for goods from abroad grew more than expected in the month, the trade data showed, with imports rising 2,3% from a month earlier.


Should imports continue to grow, it could bring a welcome boost to Germany’s eurozone partners, who sometimes complain Berlin is not doing enough to help domestic consumption.


On Wednesday, the BGA trade association’s chief Anton Boerner said that German exports would rise nominally by up to 9% to €1,046 trillion this year and imports would grow by 12% to €903bn, exceeding pre-economic crisis levels..


Car-maker Daimler said last week it expects first-quarter vehicle sales to grow significantly after it sold 16,6% more cars in the first two months of 2011 than a year earlier.

REUTERS