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German exports and industry output beat forecasts in April
[BERLIN] German exports and industrial output both rose more sharply than expected in April, getting Europe's largest economy off to a strong start to the second quarter.
Seasonally adjusted exports jumped by 1.9 per cent on the month, data from the Federal Statistics Office showed on Monday, far outstripping the consensus forecast of analysts for a rise of 0.1 per cent.
Imports meanwhile fell 1.3 per cent, countering economists'expectations for a rise of 0.5 per cent on the month and widening the country's trade surplus to 22.3 billion euros.
That may add fuel to the international debate over Germany's high current account surpluses as the G-7 meets in Bavaria. "This morning's data shows that the economy has left its industrial hibernation behind," ING economist Carsten Brzeski said, adding that the figures pointed to a good start to the second quarter.
He said the European Central Bank's record low interest rates, the still weak euro, relatively cheap energy and Germany's robust labour market were "the best prerequisites for another decent growth performance".
Data on Friday showed German industrial firms received 1.4 per cent more orders in April than the previous month as strong foreign demand outweighed a slip in domestic demand. "German exporters are increasingly capitalising on the advantages of a weaker euro, as well as a global demand recovery," Berenberg economist Christian Schulz said.
April marked the third straight month of growth in exports.
In the first quarter German gross domestic product grew 0.3 per cent, a marked slowdown from 0.7 per cent growth in late 2014, with foreign trade largely to blame.
In the second quarter, leading economic institutes expect the economy to gain momentum and expand 0.5 per cent.
For the whole year, the government expects domestic demand to drive a 1.8 per cent expansion, while the central bank predicts 1.7 per cent growth.