Germany's Trade Surplus Rises To Second Highest Level Since 1950


Photo: AP Images

Germany’s trade surplus has risen to its second highest level in more than 60 years after an unexpected drop in imports in December.Exports rose over 2012, pointing to the strength of Europe’s largest economy. And in further signs of a global economic recovery, China’s exports and imports surged in January while inflation eased.

German imports declined by 1.3% in December, defying expectations of a rise of 1.4%. But exports inched up 0.3% from November, driving the full-year trade surplus to €188bn (£160bn), the second highest since records began in 1950.

Christian Schulz, from Berenberg Bank, said: “German trade was weak at the end of 2012, with exports failing to rebound from their sharp November fall and imports falling further.

“But overall, German exporters did impressively well in 2012, with exports rising by 3.4%, despite the euro crisis and weakness elsewhere. Imports on the other hand were surprisingly weak given that Germany’s strong fundamentals should have supported domestic demand.”

Europe’s largest economy shrank by 0.5% in the last three months of 2012, in its worst quarterly performance since the financial crisis of 2008-2009. But most economists expect the German economy to grow this quarter and avoid a recession, defined as two consecutive quarters of contraction.

Meanwhile, China’s exports jumped 25% in January from a year earlier, beating expectations of a 17% rise; while imports surged by 28.8%, well ahead of a 6% rise in December.

Economists said the data was skewed by the week-long lunar new year holiday, which tends to be accompanied by out-of-kilter trade figures. The holiday fell in January 2012 but February 2013, meaning there were five fewer business days in January last year. Exporters, in particular, tend to work overtime in advance of the week-long holiday, making comparisons tricky.

But it is thought that the data is positive, even accounting for these effects. Zhang Zhiwei, economist at Nomura in Hong Kong, said: “After controlling for the Chinese new year, the numbers are still very strong and show the economic recovery is on track.”

Other data showed annual consumer price inflation of 2% in January, easing from a seven month high of 2.5% in December.

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