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German August trade data disappoints - ING

FXStreet (Łódź) - Carsten Brzeski from ING comments on today's German trade numbers which further prove that August was a very unfavorable month for the country's economy.

Key quotes


"Exports dropped by 5.8% MoM, from +4.8% in July. This is the strongest drop since January 2009. As imports only dropped by 1.3% MoM, from -1.4% in July, seasonally-adjusted trade balance dropped to 17.5 bn euro, from 22.2 in July."

"The German economy has experienced an extremely sharp stand-still in August. Industrial production, new orders and exports were down. And the magnitude of the fall brings back memories of the peak of the financial crisis in early 2009."

"The extreme sharp stand-still of the German economy in August is not easy to explain. Of course, the cooling of many export destinations combined with increased uncertainty stemming from the Ukrainian crisis look like the main drivers of the slowdown but in our view fall short explaining the entire story."

"One-offs like the timing of the summer school vacation could be the missing link between just bad numbers and this week’s horrible numbers."

"Looking ahead, this week’s German data show that in spite of the soccer miracle in the summer, there definitely won’t be any economic miracle. On the contrary, the economy seems to need a small miracle in September to avoid a recession in the third quarter."

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