German Exports Unexpectedly Rose on Non-European Trade
German exports unexpectedly rose in October as shipments to countries outside Europe offset weaker demand in the euro area.
Exports adjusted for work days and seasonal changes increased 0.3 percent from September, when they decreased 2.4 percent, the Federal Statistics Office in Wiesbaden said today. Economists forecast a 0.3 percent decline, according to the median of 14 estimates in a Bloomberg News survey. Imports rose 2.5 percent from September.
While the German economy grew 0.2 percent in the third quarter, the euro area, Germany’s largest export market, succumbed to recession. Weaker demand from the 17-nation currency bloc will impact Germany, the Bundesbank said last week, predicting a contraction in the fourth quarter and stagnation in the first three months of 2013. Still, business confidence unexpectedly rose last month and factory orders, an indicator for future production, jumped 3.9 percent in October.
“The outlook may now be slowly improving with positive signals for Chinese and American growth, but the Eurozone recession is likely to continue to weigh on German exports,” said Christian Schulz, an economist at Berenberg Bank in London. The rise in imports “does suggest resilience in domestic demand,” he said.
The Bundesbank sliced more than 1 percentage point off its forecast for economic expansion in Germany next year. It cut its 2013 projection to 0.4 percent from the 1.6 percent predicted in June and said the economy will grow 0.7 percent this year, down from its previous forecast of 1 percent.
“However, there’s reasonable hope that the phase of economic weakness won’t last too long and Germany will return to growth,” the Bundesbank said.
Shipments from Germany to non-EU countries increased 9.9 percent in the third quarter, the statistics Office in Wiesbaden said last week, with those to the U.S. surging 25.7 percent. Deliveries to EU member states declined 0.9 percent. Exports to other euro-area nations fell 3 percent.
Bayerische Motoren Werke AG, the world’s biggest maker of luxury cars, last month posted third-quarter earnings that beat analyst expectations, helped by growth in the U.S. and Asia.
“The situation in Germany is not as bad as it seems,” said Gerd Hassel, an economist at BHF Bank AG in Frankfurt. “There might be a slump in the fourth quarter, but I expect the economy to grow again in the first quarter of next year.”
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