German Exports Continue To Rise

According to the recently published data on the German trade balance, the euro zone’s largest economy might have escaped recession in the first quarter.

German exports increased for a second consecutive month in February, driven by demand from outside the euro zone, where they recorded growth of 13.4 percent compared with the year before. Exports, according to calendar-adjusted and seasonally adjusted data, rose 1.6 percent from January, when they gained 3.4 percent on the previous month, the German Federal Statistics said today.

February represents the second straight month of gains for both imports and exports. Adjusted imports in February grew 3.9 percent from the previous month, and in January imports rose 2.4 percent. Economists said that the imports growth in February was probably due to energy imports, caused by very low temperatures.

Germany’s seasonally adjusted trade surplus narrowed in February as imports increased at a faster rate than exports. The nation’s trade surplus shrank to 13.6 billion euros in February from 15.1 billion euros in January.

Last week figures showed that German industrial production fell 1.3 percent in February, compared with the previous month.

The German economy may avoid a recession in the first quarter due to the growing exports outside of euro zone and a record low unemployment, which boosts domestic demand and helps to offset the impact of euro zone debt crisis on foreign sales to the EU, which is the main export market for Germany.

Sources: Bloomberg and BBC

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Kenny Fisher

Kenny Fisher

Currency Analyst at Market Pulse
Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.