Germany's trade surplus widens sharply in July as imports slump

AI summary

<ul><li>Germany July trade balance €21.3 billion vs €15.9 billion expected</li><li>Prior €15.4 billion</li><li>Germany July exports -0.8% vs +0.1% m/m expected</li><li>Prior +0.9%</li><li>Germany July imports -5.7% vs -0.9% m/m expected</li><li>Prior +4.4%</li></ul><p class="text-align-justify" style="text-align: justify;">The breakdownThe German trade surplus widened in July but it comes as both exports and imports falling on the month. In particular, the latter dropped heavily with weakness from China being rather evident.</p><p class="text-align-justify" style="text-align: justify;">Exports to the US were a standout, climbing by over 19% compared to June. However, exports to the likes of the UK and China fell notably by over 7% and over 9% respectively.</p><p class="text-align-justify" style="text-align: justify;">Looking to imports, the big drag comes from China as imports from the Asian country dropped markedly by over 7% in July.</p><p class="text-align-justify" style="text-align: justify;">So while the headline trade surplus looks strong, the underlying signal is mixed. Exports softened and the improvement came mostly from weaker imports.</p><p class="text-align-justify" style="text-align: justify;"></p><p class="text-align-justify" style="text-align: justify;">What does the data measure?Germany’s trade balance tracks the difference between goods exports and imports. It is a useful gauge of external demand and the health of Germany’s export-heavy industrial economy.</p