German exports rose by 3 per cent on the month in December, official data showed today, pushing foreign demand above the year-ago level for the first time in 14 months and easing concerns about economic recovery.
The monthly rise in the exports - the fourth in a row - was, however, accompanied by a larger rise in imports, which ate into Germany's trade surplus.
Adjusted for seasonal swings, German exports rose by 3 per cent on the month to €72.3 billion, with imports climbing by 4.5 per cent to €55.6 billion, preliminary data from the Federal Statistics Office showed.
This yielded a trade surplus with the rest of the world of €16.7 billion in December, down from €17.0 billion in November. A reading of €15.0 billion had been forecast.
"These figures are unreal. Exports are just going from strength to strength," said DekaBank economist Andreas Scheuerle.
"It looks like it's turning into a typical German recovery which will rely on foreign demand for a long while. But Germany is vulnerable because of this. If foreign demand falls away, there's little we can do to compensate."
Germany had been the world's biggest exporter of goods since 2003, though it was likely overtaken by China last year. Exports from Europe's biggest economy were expected to rise by 0.7 per cent and imports to grow by 3.0 per cent in December.
The government expects the economy to grow by 1.4 per cent this year, driven by a projected 5.1-per cent rise in exports. However, economy minister Rainer Bruederle said last Friday Germany's economic recovery was not yet self-sustaining.
German business sentiment rose more than expected in January to its highest level in over a year, suggesting recovery will gather pace once the economy emerges from a harsh winter.
Leading German companies are cautiously optimistic.
German chipmaker Infineon doubled its 2010 sales growth forecast late last month as it posted strong first-quarter results, pointing to continued high demand which it said underscored signs of a rebound.
Reuters