German Exports Surges Signaling Economic RecoveryJana Randow
German exports rose more than economists forecast in April, adding to signs that Europe’s largest economy is gaining strength.
Exports, adjusted for working days and seasonal changes, jumped 1.9 percent from March, when they gained 0.5 percent, the Federal Statistics Office in Wiesbaden said today. That’s the strongest increase since May 2012. Economists predicted a gain of 0.1 percent, according to the median forecast of 17 economists in a Bloomberg News survey. Imports advanced 2.3 percent in April.
German business confidence rose for the first time in three months in May after an unusually long winter delayed a recovery in Europe’s largest economy. At the same time, factory orders dropped in April and industrial production probably stagnated. The Bundesbank, which last month said it expects the economy to gather pace in the current quarter, will publish new forecasts today.
“Much speaks for the fact that trade will provide positive impulses in the export-led German economy in the second quarter,” said Jens Kramer, an economist at NordLB in Hanover. “Private consumption continues to be robust, while investment remains weak.”
European Central Bank President Mario Draghi yesterday said exports are an important growth driver for the euro area, which is struggling to emerge from the longest recession in its 14-year history. The economy will return to growth by the end of the year, Draghi said, handing policy makers a reason to hold back fresh stimulus.
After keeping interest rates at a record low of 0.5 percent, the ECB yesterday revised its economic outlook. It now predicts the 17-nation euro region will shrink 0.6 percent this year before growing 1.1 percent in 2014, with inflation averaging 1.4 percent and 1.3 percent, respectively.
HeidelbergCement AG, the world’s third-largest maker of cement, said on May 8 that first-quarter earnings rose 3.3 percent as North American growth and job cuts helped offset harsh winter conditions that impeded building in Europe.
Germany’s trade surplus narrowed to 18.1 billion euros ($24 billion) from 18.8 billion euros in March. The surplus in the current account, a measure of all trade including services, dropped to 17.6 billion euros from 20.4 billion euros.