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German Export Growth Improves Strongly In August

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Germany's export growth accelerated sharply in August, suggesting that activity in the biggest euro area economy revved up after a brief summer lull, despite a strong euro.

Exports grew a calendar-and-seasonally adjusted 3.1 percent from July, when they rose 0.2 percent.

Shipments increased for a second straight month and at the fastest pace in a year.

"While financial markets and the ECB have been discussing the risks of a stronger euro, the country which often claims to be export world champion is still enjoying a strong export recovery," ING Bank economist Carsten Brzeski said.

"Despite the summer lull, the year 2017 should be the best year for German exports since 2010."

Imports also rose for a second month running, up 1.2 percent in August after 2.4 percent growth in July.

The trade deficit widened to EUR 21.6 billion from EUR 19.3 billion in July. Economists had expected EUR 19.5 billion shortfall.

On a year-on-year basis, German exports grew 7.2 percent and imports rose 8.5 percent.

Exports to the EU climbed 8.5 percent and imports from the group grew 10.8 percent. Shipments to the euro area rose 10.6 percent and imports from the region increased 10.4 percent.

ING Bank's Brzeski said that the biggest risks for the German economy and the export sector come from the outside.

"Geopolitical risks, a slowdown of the US or UK economy and a deflating eu(ro)phoria could dent the strong growth momentum," the economist said.

"However, for the time being, the German economy is enjoying the best of all worlds: strong domestic demand and surging exports."

The Destatis also reported that the German current account surplus in August grew to EUR 17.8 billion from EUR 16.9 billion a year ago.

by RTT Staff Writer

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