The spread of COVID-19 in Germany
EU's largest economy is being complicated by supply chain disruptions, according to the statistics office on Tuesday, in a sign that supply chain disruptions are complicating the recovery of Europe's largest economy.
The seasonally adjusted exports dropped by 0,7% on the month to 112.3 billion euro $129.75 billion compared to economists' expectations for no change.
The rise in imports was 1% to 99.2 billion euros, which is weaker than the 0.6% rise predicted.
The seasonally adjusted data showed that exports were still down 0.3% compared to February 2020, when imports were up 7.8%, compared to February 2020, the month before the coronaviruses hit Germany.
The trend would likely continue for the rest of the year as supply bottlenecks are weighing on production, which is weighing back exports, Bankhaus Lampe economist Alexander Krueger said.
In September, the trade surplus stood at 13.2 billion euro, much lower than in the previous period before the epidemic, when it often exceeded 20 billion euro each month.
The German exports to the United Kingdom fell by 10% to 5.7 billion euro, and imports from Britain dropped by 20% to 2.3 billion euro, according to a breakdown of the year-on-year trade data.
German exports to China fell by 0.2% on the year to 8,5 billion euro, while exports to the United States jumped 16.2% on the year to 10.8 billion euro.
Weaker demand from China is a cause for concern. The growth spurt will happen only when supply chains function more smoothly. However, that will take some time, Krueger said.
A survey done by Ifo economic institute showed that October export expectations fell to the lowest since February as supply bottlenecks have affected the industrial sector.
The economy ministry of Germany cut its forecast for the year to 8.6% from 9.2% it had predicted in April, as it noted that there is a historically unique shortage of intermediate goods that is facing the manufacturing sector.