German exports drop to lowest since 2012

Bloomberg

German exports fell the most in more than five years at the start of 2018, holding back growth in Europe’s largest economy. A breakdown of first-quarter gross domestic product data showed foreign sales fell 1 percent, the most since 2012. Imports also declined, and net trade knocked 0.1 percentage point off GDP.
“The drop in exports could be a first sign that the appreciation of the euro in 2017 has started to leave its mark on the economy,” said Carsten Brzeski, an economist at ING-Diba in Frankfurt. But “strong private consumption, the pick-up of investments and low inventories still bode well for the German growth outlook.” The euro-area economy also experienced a slowdown in the first three months of 2018. Despite assurances by European Central Bank officials that weakness would be temporary, the region’s PMI showed a further loss of momentum in May. ECB chief economist Peter Praet was unfazed. “There are clouds, but economic conditions are good,” Praet said at a conference in Brussels. The trailing off in indicators is attributable in part to supply constraints, he said, adding that the rallying euro is probably the cause of some of the slowdown.