Germany's trade surplus narrowed unexpectedly in August as exports fell for the first time in four months, tempering hopes of robust third quarter growth in Europe's largest economy.
Adjusted for seasonal swings, exports fell 1.8 per cent month-on-month to €67 billion, while imports rose by 1.1 per cent to reach €56.4 billion, figures from the Federal Statistics Office figures showed today.
The drop in exports put the adjusted trade surplus at €10.6 billion, down from €12.5 billion in the prior month, the Office said.
Rising exports have fanned hopes of a strong recovery at a time when domestic demand could falter due to rises in unemployment. Germany exited its sharpest post-war recession in the second quarter with growth of 0.3 per cent.
Retail sales fell unexpectedly in August as households braced for tougher times ahead, and economists do not expect the consumer to be a source of growth in the coming months.
Unemployment has been largely held at bay due to government subsidy schemes, although there is a fear that with last month's election out of the way, firms could be more aggressive in laying off staff.
Economists were hopeful however that the fall in exports in August was a temporary setback, and that foreign trade would contribute positively in the months ahead.
Official data released this week show manufacturing output and orders both rose slightly more than expected in August, suggesting a modest recovery from the depths of the downturn was underway.
Foreign demand was cited as a driver of the orders boost, but the output rise was driven by government stimulus measures and economists warn that a self-sustainable recovery is still not on the horizon.
The global slump has dealt a particularly hard blow to German industry, which is focused on exports, a policy that has helped establish it as the world's top exporter of goods.
But the arrangement also means it is well placed to profit from any rises in global demand.
Reuters