2020.12.0907:11:00UTC+00German Exports Growth Slows More Than Expected

Germany's exports growth slowed more-than-expected in October, data from Destatis revealed Wednesday.

Exports increased 0.8 percent month-on-month in October, slower than the 2.3 percent increase seen in September. Shipments were forecast to climb 1.2 percent.

At the same time, imports gained 0.3 percent, following a 0.2 percent rise in September. This was also slower than the economists' forecast of +1 percent.

As a result, the trade surplus rose to a seasonally adjusted EUR 18.2 billion from EUR 17.6 billion in the previous month. The expected level was EUR 18 billion.

Exports were by 6.8 percent and imports by 5.2 percent lower than in February 2020, the month before restrictions were imposed due to the corona pandemic in Germany.

On a yearly basis, the decline in exports deepened to 6.5 percent from 3.8 percent. Likewise, imports fell 5.9 percent after falling 4 percent in the previous month.

The trade surplus totaled an unadjusted EUR 19.4 billion compared to a EUR 21.3 billion surplus in the same period last year.

The current account surplus climbed to EUR 22.5 billion from EUR 19 billion in the previous year.

Data showed that exports to China increased 0.3 percent annually, while exports to the United States dropped 10.5 percent. Shipments to the United Kingdom showed an annual decrease of 11.7 percent.

Most imports came to Germany from China. Nonetheless, imports of goods from China fell 3.3 percent. Imports from the United States plunged 18.8 percent and that from the UK were down 17.6 percent.

Despite the October slowing, the export sector remains one of the few hopes of the German economy to avoid a significant contraction in the fourth quarter, Carsten Brzeski, an ING economist said.

However, the longer-term outlook remains very mixed, illustrating that the sector will not easily return to its former strength, the economist noted.