German trade surplus narrows as exports drop in March

The German trade surplus narrowed in March, as exports saw the biggest drop in nearly a year, weighing on Germany's uneven recovery, official data showed on Friday. Adjusted for calendar and seasonal swings, German foreign trade recorded a surplus of 14.8 billion euros (20.4 billion U.S. dollars), according to the Federal Statistical Office. In February, Europe's largest economy had a trade surplus of 15.7 billion euros. In January, the surplus was 17.3 billion euros. Adjusted exports shrank by 1.8 percent month-on-month in March. This was the biggest drop since May 2013, when exports fell by 2.1 percent. Imports too declined by 0.9 percent last month. Friday's figures matched market expectations that foreign trade would drag economic recovery in Germany. Domestic consumption and industrial investments were considered as the economy's main driving forces. Recent data, however, showed that Germany's recovery would not be even as external uncertainties escalate. Industrial output and orders both fell in March, to the surprise of economists who forecast slight increases. The German Federal Economy Ministry said "current geopolitical events" could restraint German industrial activities, pointing to tensions in Ukraine. The German central bank said the economy would slow down "markedly" in the second quarter compared with the first three months, during which gross domestic product (GDP) was estimated to increase by 0.7 percent. For the whole year, the German economy was expected to expand by 1.8 percent, following a slight growth of 0.4 percent in 2013.