German exports rise as country tries to avoid recession

FRANKFURT — German exports rose unexpectedly in September, official figures showed Friday, fueling speculation that Europe’s biggest economy may avoid sliding into a shallow recession despite headwinds from the U.S.-China trade dispute and Brexit.

Germany’s statistics agency Destatis said exports rose by a monthly 1.5% in September, way ahead of market forecasts for a 0.3% increase. August’s decline was revised to show that exports only fell by 0.9%, half the original estimate of 1.8%.

The figures suggest Germany may avoid following up the 0.1% quarterly decline in economic output in the second quarter with another in the third. A decline in figures out Nov. 14 would show the country in a shallow recession; two straight quarters of declining output is a frequently used definition of recession.

Carsten Brzeski, chief economist at ING Germany, said the figures suggested that “a technical recession is not a done deal” and that a third-quarter dip in output might be avoided “at the last minute.”

He added that “still, contraction or not, the fact remains that the German economy has been in de facto stagnation for more than a year. This is clearly nothing to become too cheerful about.”

Services companies and the jobs market have held up well in Germany, but the industrial sector, led by autos and factory machinery, has seen a decline in activity.

The dispute between U.S. President Donald Trump and the Chinese leadership over China’s trade surplus with the US has dampened trade and industrial output by raising uncertainty about whether and where more tariffs, or import taxes, might be imposed. Another negative is uncertainty about the date and terms of Britain’s departure from the European Union.

David McHugh, The Associated Press