Germany's foreign trade in February 2025 showed that exports rose by 1.8 percent month-over-month to €131.6 billion yet fell by 1.8 percent compared to February 2024. Imports rose by 0.7 percent from January to €113.8 billion and increased by 3.1 percent year-over-year. The resulting trade surplus grew slightly to €17.7 billion, although it remains significantly below last year's €22.6 billion, suggesting some softening in Germany's export-driven strength.

Trade within the EU showed moderate monthly gains, particularly in imports from eurozone countries (2.8 percent). However, it was trade with non-EU partners that showed sharper contrasts: Exports to the US surged by 8.5 percent to €14.2 billion, reaffirming Germany's position as the country's top export destination. In contrast, exports to the UK declined by 3.8 percent, while trade with China remained relatively stable.

Notably, trade with Russia continued its sharp contraction, with imports plunging by 49.4 percent compared to the previous yearreflecting ongoing geopolitical tensions and sanctions.

While monthly trade activity has shown resilience, the shrinking annual surplus and divergence among trading partners indicate ongoing structural pressures and global uncertainties affecting Germany's trade performance. This latest update takes the German RPI to minus 21 and the RPI-P to minus 17. This means that economic activities remain well behind the expectations of the German economy.

The consensus looks for the trade surplus to rise to E18.1 billion in February from E16.0 billion in January.

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.

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.