Welcome to Extreme Investor Network! Today, we are diving into the latest economic indicators from Germany and the potential impact of the US presidential election on the global economy.
In September, exports in Germany saw a decrease of 1.7%, while imports rose by 2.1%, signaling an uptick in domestic demand. However, industrial production figures took a hit, falling by 2.5% in the previous month, contrary to economists’ expectations of a 1% decline.
These indicators have raised concerns about a potential 0.2% annual economic contraction in Germany for 2024. Despite this, there is a glimmer of hope as factory orders in September and October’s Manufacturing PMI showed signs of improvement, hinting at a possible stabilization in the German economy.
The HCOB Manufacturing PMI increased from 40.6 to 43.0 in October, indicating a slowing decline in new orders. This aligns with the 4.2% increase in factory orders seen in September, providing some optimism for the future.
However, the outcome of the US presidential election could pose a significant threat to this recovery. With Donald Trump’s victory, there are concerns about potential tariffs on EU goods, which could lead to a trade war and negatively impact the German economy.
As Daniel Kral, a Europe macro specialist at Oxford Economics, pointed out, the looming threat of tariffs could create a setback for the German economy in the coming months.
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