independent

Wednesday 16 April 2014

Record German exports defy debt crisis

German exports rose in December, capping a record year even as the sovereign debt crisis weighed on eurozone demand.

Exports, adjusted for working days and seasonal changes, increased 0.3pc from November, when they fell 2.2pc, the Federal Statistics Office in Wiesbaden said yesterday.

Economists forecast a 1.4pc increase. Exports rose 3.4pc in 2012 to a record €1.1 trillion.

Export growth has slowed as the debt crisis dampens sales within the euro area, prompting German companies to target faster-growing markets in Asia.

Europe's largest economy is showing signs of recovering from a fourth-quarter slump as the debt crisis eases. Investor and business confidence improved more than forecast in January and the unemployment rate fell to 6.8pc, matching a two-decade low.

Imports fell 1.3pc in December, yesterday's report showed. The trade balance narrowed to €12bn from €16.9bn in November. At €188.1bn in 2012, the annual trade surplus was the second-highest since records began in 1950, the statistics office said.

The surplus in the current account, a measure of all trade including services, was €17.3bn, up from €16.2bn in November.

ECB president Mario Draghi, pictured, signalled on Thursday that policy-makers are concerned the recent appreciation of the euro may threaten the 17-nation economy's recovery later this year.

The exchange rate "is important for growth and price stability," Mr Draghi said. "We want to see if the appreciation is sustained, and if it alters our assessment of the risks to price stability."

The euro – which rose to a 14-month high above $1.37 earlier this month – fell to $1.3390. The ECB expects the euro-area economy to contract by 0.3pc this year, while the Bundesbank predicts the German economy will grow 0.4pc. (Bloomberg)

Irish Independent

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