Germany’s Trade Surplus and Exports Reach All-Time High

[Tender Branson]

German exports rose above 100 billion euros ($129 billion) for the first time in July and the trade surplus climbed to an all-time high, even as escalating sanctions against Russia threatened trade flows.

Exports gained the most in more than two years, climbing 4.7 percent from June to 101 billion euros, data from the Federal Statistics Office in Wiesbaden showed today. The trade gap widened to 23.4 billion euros from 16.6 billion euros.

“The German economy had a very positive start into the third quarter,” said Johannes Gareis, an economist at Natixis in Frankfurt. “Although it is early days, the data suggest that Germany will re-fire up its engine in the third quarter and will be able to avert a technical recession.”

http://www.bloomberg.com/news/2014-09-08/german-trade-surplus-at-record-as-exports-rise-to-all-time-high.html

Also, industrial production is up by much more than expected in July:

German industry has posted its strongest month in almost two and a half years.

The Economy Ministry said industrial production was up 1.9% in July, lifted by an increase in manufacturing and construction output.

It is a big improvement from June when industrial production rose just 0.4%.

It is another piece of strong data from Germany. On Thursday data showed that industrial orders rose at the strongest rate in the more than a year in July.

http://www.bbc.com/news/business-29075644

[AggregateDemand]

Mercantilism holds no promise for the future. We've chastised Asia for decades, now Europe is headed back to the middle ages. I have some sympathy for Germany, since they sell manufacturing components to China, who still devalue their currency against the dollar to increase exports to the United States. I'm not sure we can ask Germany to look a gift horse in the mouth. Germany is also dedicated to manufacturing technocracy, and their apprenticeship and training programs are second-to-none. This outcome was somewhat inevitable; however, I wonder if they've made arrangements for the long-term or if they will simply ride the wave of exports until they crash and burn like Japan.

[Simfan34]

Shame on you, Germany, with your balanced budgets and trade surpluses! Bad, bad, bad!