German exports fall in July

German exports fell by 0.9% on a monthly basis from an upwardly-revised 0.2% rise in June, according to official statistics published on Monday.

Imports rose by 1.4%, after a sharp downwardly-revised 3.2% in June.

Exports to other EU economies rose month on month by 0.5%, while exports to non-EU economies fell 2.5%, despite another increase in exports to the US and China, largely due to a 3.5% slump in trade to the UK.

Imports from China plunged 5.8%, and those to the UK. fell by 3.2%, but imports from the US picked up 6.1% to €7.9bn. Imports from the UK dropped by 3.2% to £3bn.

Exports to Russia were up on the month but remain just over 30% below their level in July last year. Imports from Russia fell sharply by 15.7% on the month, and are down 91.8% from their level last July. These figures reflect the impact of EU sanctions on Russia after its unprovoked invasion of Ukraine.

"Given the change in export and import prices in July, we calculate that the inflation-adjusted trade surplus in goods also narrowed sharply at the start of Q3, to €14.7bn from around €17.0bn in June, and an average of €16.4bn over Q2 as a whole," said economists at Pantheon Macroeconomics.

"As such, the goods trade data for July suggest that the fall in real net trade in Q3—what matters for GDP—will be in line or perhaps even bigger than that seen in Q2. If growth in China remains subdued, this seems likely; even more so if tense trade relations between Germany and China sour further."

"The business surveys, which show a continued plunge in new export orders both in goods and services in July and August, also suggest net trade may pull GDP down again in Q3. That said, it's still early days, and net trade in services is a wildcard."

Reporting by Frank Prenesti for Sharecast.com