German Stats Office Reports Shock Drop in July Exports, Imports

Street, the ^ | 09 September 2016 | Larua Board

[Lorianne]

German imports and exports unexpectedly shrunk in July, with a sharp export contraction causing a surprise narrowing in Germany's trade balance.

Federal Statistical Office data showed seasonally adjusted exports fell by 2.6% - analysts had expected about 0.3% growth - whereas imports fell by 0.7%, as against expectations for a 0.8% rise.

On the year exports slumped by 10% and imports shriveled by 6.5%.

The foreign trade balance shrunk to €19.4 billion ($21.9 billion) from €21.4 billion in June, as against expectations for a balance of €22 billion.

The Federal Statistical Office said the pace of German exports to other EU countries fell by 7% in July, while imports from the region fell by 4.5%. The falls were slightly narrower for trade with other eurozone countries.

[BenLurkin]

“Unexpected.”

Fed will have to not raise rates.

“Unexpected”

[major-pelham]

The Germans wouldn’t sit one minute for a merchandise trade deficit beyond nominal.

[major-pelham]

The Germans wouldn’t sit one minute for a merchandise trade deficit beyond nominal.

[Gay State Conservative]

When Germany catches cold Europe gets pneumonia.

[DoughtyOne]

Merkel, Merkel, Merkel...

Three cheers for Merkel!

/s

[PTBAA]

Perhaps more Moslems will help...

[ken in texas]

Wait... you mean the high-achieving muslim immigrants haven’t improved the German economy?

[Gen.Blather]

“Wait... you mean the high-achieving muslim immigrants haven’t improved the German economy?”

I have seen estimates from Germany that the “immigrants” are costing upwards of 100,000 Euros a year, each. That’s if they don’t end up in prison. If they do, the price goes up.

[Berlin_Freeper]

despite the slowdown the country still posted a €19.4bn trade surplus in July.

Demand for goods from Europe’s biggest economy dropped the most from countries outside the EU.

[RightGeek]

Better put all those Muslim “refugees” to work! LOL!

[Berlin_Freeper]

Overwhelming majority of refugees in Germany are overqualified – OECD report

[Rashputin]

Wonder how much longer Germany will go along with sanctions on Russia ?

[PAR35]

Just concentrate them into labor camps and put them to work. 2000 calories a day in food ought not cost that much.

[Mr. K]

I never understood why trade deficit is a bad thing

I have a 100% trade deficit with my local grocer.

I give him money and I get goods I want.

I supposed if I lost my job MAKING those goods to him, it would be a bad thing, but then he would have no one to sell to- so it would be just as bad for him.

[kabar]

I never understood why trade deficit is a bad thing I have a 100% trade deficit with my local grocer.

Why is there a trade deficit? Could it be that our manufacturing base is migrating overseas to countries that have cheaper labor, less regulations, and less taxes? What does that do to our workers and how does the relocation of industries abroad affect our tax base?

You are not in competition with your grocer for a job or income.

Trade deficits have harmed the domestic economy in at least three direct ways. First, the steady growth in our trade deficits over the past two decades has eliminated millions of U.S. manufacturing jobs. Between 1979 and 1994, trade eliminated 2.4 million jobs in the U.S.2 Growing trade deficits were responsible for most of these job losses, which were concentrated in manufacturing, because most trade involves the sale of manufactured goods. NAFTA added to the flow of jobs out of the U.S. by encouraging firms to move production to Mexico and Canada. Our trade deficit with both countries increased from $16 billion in 1993 to $48 billion in 1996 (in constant 1987 dollars). The U.S. lost 395,000 jobs as a result of the NAFTA deficits.

Second, trade deficits have also had a depressing effect on wages, in several ways. The jobs lost through trade do not raise the unemployment rate in the long-run. Macroeconomic policies such as interest rates and government spending have much greater influence on the total level of employment and output than does trade. But trade does effect the composition of employment. Workers not employed in manufacturing find jobs elsewhere in the long run, usually in service industries where wages are much lower.

The growth in imports, especially from low-wage countries, also puts downward pressure on the wages of U.S. workers. If the prices of these products fall, then this puts downward pressure on prices in the U.S. Domestic firms are then forced to cut wages or otherwise reduce their own labor costs in response.

The third problem with trade deficits is their corrosive effect on our long-term trade competitiveness. When the U.S. dollar and our trade deficit soared in the early 1980s, many domestic firms and industries in sectors such as steel and semiconductors were decimated. Once closed, many plants in such industries failed to re-open, even after the dollar depreciated later in the 1980s.

Dr. Peter Morici, in an important new study for the Economic Strategy Institute, has identified another major reason why deficits have such corrosive, permanent effects on our competitiveness. Morici found that eliminating the U.S. trade deficit would increase U.S. spending on R&D by an estimated 3 percent. This would in turn increase productivity growth by about “0.5 to 0.6 percentage points per year.”8 This single shift alone would have a massive impact on U.S. living standards, by allowing firms to raise wages for all workers.