German Oct trade surplus narrows in ‘lost year’ for exporters

Germany’s trade surplus narrowed in October with imports growing faster than exports which were slowed down by trade disputes between the United States and both China and the European Union.

The Federal Statistics Office said on Monday seasonally adjusted exports rose by 0.7 percent on the month, less than a 1.3 percent rise in imports. That meant the trade surplus narrowed to 17.3 billion euros ($19.68 billion) from 17.7 billion.

A Reuters poll of economists had pointed to a 0.5 percent rise in exports and a 0.4 percent increase in imports.

Export-dependent manufacturers in Germany, Europe’s largest economy, have been caught up in a battle over tariffs between the United States and both China and the European Union.

Andreas Scheuerle, economist at DekaBank, said “2018 is a lost year for German exporters.”

“In 2019 too, we shouldn’t place too many expectations on German foreign trade,” he added. “Instead, hopes rest on robust domestic demand.”

In November, the trade disputes caused German business morale to fall more than expected.

Most economists expect the German economy to cool rather than enter a recession. In its ninth year of growth, it has been increasingly relying on consumption supported by low interest rates, rising wages and a robust labor market.

source: Reuters