But the institutes highlighted the potential upside of the record influx of refugees to Germany.
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Meanwhile, automotive companies like Daimler (DDAIF) and Volkswagen (VLKAY) were down by 6.9% and 42.8%, respectively, over the same period. But German growth has been supported by private consumption, and that doesn’t go together with today’s numbers. By comparison, the current account surplus in August past year was EUR11.1 billion. The report stated that demand from countries beyond the euro area continues to appear “less reliable at the present moment”.
German exports slumped by 5.2% in August from the preceding month, pushing down the adjusted trade surplus to €19.6 billion ($22 billion), the Federal Statistical office said. That was the steepest decline since January 2009, an economist at Destatis said.
Researchers at the Ifo Institute for Economic Research in Munich said German exports are taking a hit from slowing demand from emerging markets, especially in China. Industrial production advanced 2.3% from a year earlier.
“The August drop marked the first decline for two consecutive months since the beginning of the year”.
European Central Bank chief economist Peter Praet told the meeting in Frankfurt that “challenges facing emerging market economies were clouding the global outlook and were unlikely to recede quickly”, the minutes said. Factory orders also declined in August, which was caused by a sharp drop in non-EU bookings.
Economists also argue that higher government spending on migrants-including asylum-related housing, medical care, and education-should provide a boost to the economy.
“The German economy is experiencing a moderate upturn”, said the think-tanks in their latest joint forecast which forecast Germany’s gross domestic product (GDP) to grow by 1.8 percent in both 2015 and 2016.
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A counter to Germany’s weakening export sector may yet be the gradually rising investment in the euro zone.
