German exports fell unexpectedly in May as shipments to the US and Russia fell sharply.
German exports fell by 0.1% from the previous month, according to data from the country’s federal statistics office. A Reuters poll had forecast a 0.3% monthly increase.
“Trade is no longer the strong driver of the German economy’s resilient growth it once was, but rather a drag,” said Carsten Brzeski, global head of macroeconomics at ING.
Supply chain friction, a more fragmented global economy and China increasingly able to produce goods it previously bought from Germany are factors weighing on German exports, Brzeski said.
Exports to European Union countries fell 1.5% for the month, while exports to the United States fell 3.6% and those to Russia 7.4%, the bureau said. .
“The weakening impulses from the United States are particularly significant,” said Alexander Krueger, chief economist at Hauck Aufhaeuser Lampe Privatbank. “As things stand, the export sector will post another quarterly decline in exports.”
Imports rose 1.7% in the month, according to the data.
The trade balance with foreign countries recorded a surplus of 14.4 billion euros in May, compared to the 16.5 billion euros of the previous month.
Sentiment in the German export sector deteriorated markedly in June, according to a survey by the Ifo Institute last week.
“In addition to weak demand in the German domestic market, we are now also seeing fewer orders from abroad,” said Klaus Wohlrabe, Head of Research at Ifo. He added that this is bad news for Germany’s export economy.
“This once again reinforces suspicions that an economic recovery will not materialize for now,” said Thomas Gitzel, chief economist at VP Bank.
Source: Terra
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