Rise in Exports Offers Germany Hope of Avoiding Fourth-Quarter Slump
Thanks to its rise in exports, Germany may be able to avoid a double-dip recession. Check out our article to see what the country's current situation is like.
According to the latest figures, German exports have exceeded predictions set for September 2020. This unexpected rise has given the country, which represents the EU’s largest economy, a fourth-quarter boost, which may prevent it from suffering a double-dip recession.
Germany’s Rise in Exports Exceeds Expectations
Originally, many economists had predicted a 2% rise in exports in Germany by the end of September, but the latest reports show that the country exceeded these expectations by hitting a 2.3% increase after seasonal adjustments were made. This follows a 2.9% rise in exports from August, putting the country in a more steady position and potentially preventing it from slipping into a worse economic state.
The country’s economy also grew by 8.2% during the third quarter of last year, breaking previous records. This was partially due to an increase in consumer spending and higher levels of exports. However, experts warn that while this is good news, Germany may still not be immune to a double-dip recession as it now faces a rise in COVID-19 cases and stricter lockdown measures.
Additionally, exports to China also rose by 10.6% from September 2019. Meanwhile, exports to the US fell by 5.8%, and those to the UK dropped by 12.4%, which should be taken into account as well.
Moving forward, Germany will likely benefit from trade with the US as threats of tariffs on German imported automobiles have dissolved, with Joe Biden becoming president. Under the Trump administration, European car exporters were expecting tariffs that would have hit German exporters hard, but with President Biden taking office, these fears have dissolved.
Overall, the future of exports in Germany looks promising, with trade picking up in certain areas and industrial output rising. However, this does not mean the country is safe from the future dangers of the pandemic and should continue to brace itself.
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