German exports experienced a much larger increase than anticipated in February, largely driven by the high demand from China and the United States. This marked the most significant increase in exports in ten months.
This was revealed by data released on Tuesday and accessed by Reuters.
According to the federal statistics office, exports rose by 4.0% compared to the previous month.
In contrast, a survey conducted by Reuters had estimated that exports would only increase by 1.6% on a month-on-month basis. In January, exports had risen by 2.5% month-on-month.
The chief economist at Hauck Aufhaeuser Lampe said, “The export sector is back on track for growth, and the sharp setback in December has been made up. Exports fell 6.1% month-on-month in December.”
It was reported that exports to European Union countries rose 2.0% in February against January, while exports to the U.S. and China rose by 9.4% and 10.2% respectively of that of January.
“The exports business is benefiting from better functioning supply chains and the opening of the Chinese economy,” Thomas Gitzel, chief economist at VP Bank, stated.
It was also reported that imports rose by 4.6% in comparison to January, which was higher than the predicted 1.0% growth by analysts. This comes after a continuous decline in imports for five months in a row.
According to the German Chamber of Commerce and Industry DIHK, real export growth of 2.5% is expected in 2023, which is one percentage point lower than the average growth rate over 2013.
The outlook among German exporters improved to some extent in March, as indicated by the increase in Ifo’s export expectations from 3.5 points in February to 4.0 points.
“Despite the increase, export demand still lacks momentum,” head of surveys at Ifo, Klaus Wohlrabe said.