German exports grew for the first time in three months in August, leading to an increase in the country's trade surplus, data from the Federal Statistical Office showed Monday.
The bigger-than-expected jump in exports points to strong demand for German goods despite a slowdown in global growth. Shipments grew 3.5 percent month-on-month, reversing July's 1.2 percent drop. In June, there was a 0.5 percent fall in exports. Economists had expected a meager 1.1 percent expansion in shipments during the month.
Imports stagnated in August following a 0.5 percent rise in the previous month. Economists had forecast a 0.6 percent increase.
Backed by a sharp rise in exports, the trade surplus increased unexpectedly to EUR 11.8 billion from EUR 10.5 billion in July. Economists had forecast a decline in the surplus to EUR 9 billion.
Meanwhile, the current account of the balance of payments showed a surplus of EUR 7 billion in August, higher than EUR 5.7 billion recorded during the same month last year. Economists had expected the surplus to fall to EUR 5 billion from EUR 7.8 billion in July.
The region's sovereign debt crisis is slowly engulfing the region and is threatening to spiral into another financial meltdown, despite relentless efforts by Eurozone leaders to tackle it.
Germany has, so far, proved to be less vulnerable to economic shocks than its peers. But with the deepening crisis now threatening to swallow some of the largest economies of the region, the largest Eurozone economy is also showing some signs of weakening.
Both industrial production and factory orders in Germany declined in August. According to the Purchasing Managers' survey released last week by Markit Economics, German manufacturing growth slowed to the weakest level in two years in September.
In the second quarter, Germany recorded a disappointing 0.1 percent growth compared to the first quarter. Though Germany's central bank forecasts robust economic expansion in the third quarter, it admitted that the medium-term outlook worsened more than originally estimated due to heightened uncertainty.
The European Commission projects German growth at 2.9 percent in 2011. Given the risks emanating from the unresolved debt crisis and its repercussions on the health of financial markets, the economy is expected to undergo a slow recovery.
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