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Is Germany’s economic recovery running out of steam? Exports fell in July for the first time in five months, according to official data published on Tuesday, reviving doubts about how solid the rebound in Europe’s biggest economy really is.
Exports dropped 0.8% from the previous month to €138.2 billion, weighed down by weaker demand from the eurozone and China, according to provisional data from statistics agency Destatis.
Analysts surveyed by financial data firm FactSet had expected a smaller decline of 0.5%, making the fall steeper than markets had priced in.
The figures land days after industrial production data for July also disappointed, and will fuel concerns that turmoil unleashed by the Iran war is putting the brakes on a nascent economic recovery.
Exports were dragged down by a 9.5% drop in shipments to China and a 2.8% fall to other eurozone countries, Destatis said.
Trade with the US told a different story. Exports to Germany’s top destination for goods jumped more than 19% from the previous month, as shipments continue to recover from the weakness triggered by US President Donald Trump’s tariff blitz.
Imports, meanwhile, fell 5.7% in July to €116.9 billion from the previous month, widening the trade surplus to €21.3 billion.
Germany’s economy had initially appeared to withstand the energy shock from the US war on Iran better than many had feared.
Indicators earlier in the year came in surprisingly strong, prompting several think-tanks last week to upgrade their growth forecasts for this year to between 1.2% and 1.4%.
Tuesday’s figures suggest that optimism may now be tested.
Additional sources • AFP