BERLIN: Booming exports pushed Germany’s trade surplus to an all-time high in March, but industrial output contracted, pointing to possible problems ahead for Europe’s biggest economy.
The trade surplus is a key gauge of an economy’s comparative strength and in recent months has highlighted the robustness of Europe’s biggest economy amid the current global economic uncertainties.
It reached the all-time monthly high in March on the back of buoyant exports, according to data published by the federal statistics office Destatis.
Analysts said the data suggested the German economy notched up solid growth as a whole in the first quarter.
Nevertheless, industrial output contracted in March, falling by a steeper-than-expected 1.3 percent, possibly indicating some clouds on the horizon.
German exports grew by 1.9 percent to 101.3 billion euros (US$115 billion) in seasonally adjusted terms in March, Destatis said. At the same time, imports decreased by 2.3 percent to 77.6 billion euros.
That meant the trade surplus — the balance between exports and imports — expanded sharply to 23.7 billion euros in March from 20 billion euros in February.
Destatis is due to publish a preliminary estimate for GDP growth in the first quarter on Friday. Economists are confident growth will be satisfactory.
“Economically speaking, the first quarter was positive for Germany in the first quarter,” said BayernLB economist Stefan Kipar.
“Strong output at the start of the year made a substantial contribution to this, even if the monthly data suggest that it won’t be able to sustain the strong momentum in the second quarter,” he said. Kipar is forecasting GDP growth of 0.5 percent for the first quarter.
Commerzbank economist Ralph Solveen said the early timing of the Easter holidays likely contributed to March’s sharp drop in industrial output.
“In combination with the positive external trade figures, the production data argues for strong economic growth in the first quarter,” he said. “But we already expect a much lower growth rate for the second quarter.”
The German government is forecasting growth of 1.7 percent this year and 1.5 percent next year.
