German trade gains momentum

The German economy currently seems to be running on all cylinders. Strong domestic demand has already been around for a long while but the former growth engines, industrial production and exports have also started to gain momentum. The latest evidence comes from the exports sector. In May, exports increased by 1.4% MoM. At the same time, imports increased by 1.2%, widening the seasonally-adjusted trade surplus to EUR 20.3bn, from EUR 19.7bn in April.

Brexit has clearly left its marks on German exports which are unlikely to go away anytime soon

Bilateral trade data over the first four months of the year show that the protectionist talks of the new US administration have had no impact so far on German exports to the US. Accounting for almost 9% of all German exports, the US remains the most important export destination. The share is still at the same level as in 2016. Brexit, however, has clearly left its marks on German exports. While in 2015, the UK accounted for around 7.5% of all German exports, this share dropped to 7.1% in 2016 and now 6.9% in the first four months of the year.