German exports unexpectedly increased and for a second consecutive month in February, largely due to higher demand for its commodities from countries outside the European Union.
The Federal Statistical Office said that exports rose a seasonally and calendar adjusted 1.6 percent month-on-month in February. This confounded economists' forecast for a 1.2 percent decline. In January, shipments rose an upwardly revised 3.4 percent.
Total exports amounted to EUR 91.3 billion in February. Exports of German commodities to countries outside the European Union climbed 14.4 percent month-on-month to EUR 37.9 billion.
Meanwhile, exports to euro area countries increased at a more modest pace of 4 percent compared to a 5.4 percent increase in dispatches to EU members.
The German economy contracted 0.2 percent in the fourth quarter, according to official data. Last week's weak industrial output figures also revealed the soft patch in the economy. Production fell more than expected in February, while new orders posted weaker-than-forecast growth.
However, "a weather-driven sharp rebound of the construction sector, moderate production and today's trade data still have the potential to lift the economy into recession-free territory," Carsten Brzeski a Senior Economist at ING Bank NV, said.
On a month-over-month basis, imports rose 3.9 percent following a 2.4 percent rise in January but a 3.9 percent decline in December last year. The monthly performance was much better than the 1.3 percent growth forecast by economists.
The trade balance was a surplus of EUR 14.7 billion, higher than January's revised surplus of EUR 13.2 billion, and it also exceeded the EUR 12 billion surplus forecast by economists. The trade balance was a surplus of EUR 11.9 billion last year.
In calendar and seasonally adjusted terms, the surplus amounted to EUR 13.6 billion in February.
The statistical office also reported that exports increased 8.6 percent annually. Imports grew 6.1 percent over the same period.
Meanwhile, the current account balance was a surplus of EUR 11.1 billion, higher than the EUR 10.6 billion surplus last year. The surplus amounted to EUR 9.5 billion in January.
The Organization for Economic Co-operation and Development forecasts that the German economy will grow 0.1 percent in the first quarter, with the pace expected to accelerate to 1.5 percent in the second quarter. The European Commission sees 0.6 percent growth for the economy this year.
by RTT Staff Writer
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