| Consensus | Actual | Previous | Revised | |
|---|---|---|---|---|
| Balance | €11.0B | €16.7B | €10.0B | |
| Imports - M/M | -3.4% | -6.1% | -5.6% | |
| Imports - Y/Y | 7.7% | 3.2% | 3.6% | |
| Exports - M/M | 2.1% | -6.3% | ||
| Exports - Y/Y | 12.2% | 5.9% | 6.3% |
Highlights
Seasonally adjusted the merchandise trade balance was in a €16.7 billion surplus in January. This was up from December's unrevised €10.0 billion and well above the market consensus. It was also the second highest reading since February 2021. Unadjusted, the black ink stood at €10.8 billion, double its post a year ago.
The headline improvement reflected a combination of stronger exports, which rose 2.1 percent on the month, and weaker imports, which fell 3.4 percent. However, the increase in the former failed to reverse a 6.3 percent slump in December and exports were still 4.3 percent below last November's record high. Sales to the Russian Federation were 60.0 percent lower than in January 2021 while imports were down 36.7 percent.
Today's update puts the German ECDI at minus 3 and the ECDI-P at minus 8, both measures indicating a very limited degree of overall economic underperformance versus market expectations.
The headline improvement reflected a combination of stronger exports, which rose 2.1 percent on the month, and weaker imports, which fell 3.4 percent. However, the increase in the former failed to reverse a 6.3 percent slump in December and exports were still 4.3 percent below last November's record high. Sales to the Russian Federation were 60.0 percent lower than in January 2021 while imports were down 36.7 percent.
Today's update puts the German ECDI at minus 3 and the ECDI-P at minus 8, both measures indicating a very limited degree of overall economic underperformance versus market expectations.
Market Consensus Before Announcement
Germany's goods balance is expected to widen to an €11.0 billion surplus in January versus a €10.0 billion surplus in December, a month however that saw sharp declines for both imports and exports.
Definition
The merchandise trade balance measures the difference between imports and exports of goods. The level of the international trade balance, as well as changes in exports and imports, indicate trends in foreign trade and can offer a guide to an economy's competitiveness.
Description
Changes in the level of imports and exports, along with the difference between the two (the trade balance) are a valuable gauge of economic trends here and abroad. While these trade figures can directly impact all financial markets, they primarily affect currency values in foreign exchange markets.
Imports indicate demand for foreign goods and services in Germany. Exports show the demand for German goods in countries overseas. Given the size of the German economy, the euro can be sensitive to changes in the trade balance. The bond market is also sensitive to the risk of importing inflation. This report gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.
Imports indicate demand for foreign goods and services in Germany. Exports show the demand for German goods in countries overseas. Given the size of the German economy, the euro can be sensitive to changes in the trade balance. The bond market is also sensitive to the risk of importing inflation. This report gives a breakdown of trade with major countries as well, so it can be instructive for investors who are interested in diversifying globally. For example, a trend of accelerating exports to a particular country might signal economic strength and investment opportunities in that country.
