German Trade Surplus Narrows on Jump in Imports
- German trade surplus narrows to €15.9 billion.
- Exports to the US surged by 5.2% in July.
- ECB President Christine Lagarde and Chief Economist Philip Lane are up next.
German Trade Surplus Narrows on Exports Decline and Imports Surge
The German economy was in the spotlight again, with trade data in focus. Manufacturing PMI numbers from Friday painted a grim picture of the German economy. Falling new orders suggested a likely slump in imports and exports.
In July, the German trade surplus narrowed from €18.7 billion to €15.9 billion. However, exports declined by 0.9%, while imports increased by 1.4% in July. Economists forecast a trade surplus of €18.0 billion and for exports to fall by 1.5%.
According to Destatis,
- German exports to EU member states increased by 0.5%, while imports from EU member states increased by 2.9%.
- Exports to euro area countries rose by 1.7% while imports surged by 5.6%.
Trade with non-EU countries (Third Countries):
- German exports to third countries slid by 2.5%, while imports slipped by 0.2%.
- Exports to the US increased markedly, rising by 5.2%, with exports to China increasing by 1.2%.
- While imports from China accounted for the lion’s share, imports declined by 5.8% compared with June 2023.
EUR/USD Reaction to German Trade Report
Before the German trade figures, the EUR/USD slipped to a pre-stat low of $1.07716 before rising to a high of $1.07904.
However, in response to the German trade report, the EUR/USD fell to a post-stat low of $1.07835 before rising to a high of $1.07908.
This morning, the EUR/USD was up 0.13% to $1.07689.
ECB Commentary is Up Next
The focus will turn to the ECB as investors ease bets on further Fed interest rate hikes. ECB President Christine Lagarde and Chief Economist Philip Lane are on the calendar to speak.
Until now, the ECB has remained determined to forge ahead to tame inflation at the expense of the Eurozone economy. A shift in sentiment toward the economic outlook and forward guidance beyond September will influence.
The ECB remains data-dependent, leaving the EUR/USD exposed to plans to hit the brakes.
There are no US economic indicators for investors to consider, with the US markets closed for Labor Day. The lack of stats will leave FOMC member commentary to draw interest.