Published by Global Banking & Finance Review®
Posted on September 8, 2025
3 min readLast updated: January 22, 2026
Add as preferred source on GoogleGerman exports fell by 0.6% in July due to US tariffs. Investor sentiment also dropped, but industrial production saw a 1.3% rise.
By Maria Martinez
(Reuters) - German exports unexpectedly fell in July on a sharp decline in U.S. demand due to Washington's tariffs on European imports, official data showed on Monday, while a survey indicated that investor morale has plunged this month.
Exports from Europe's biggest economy fell by 0.6% in July from the previous month, data from the federal statistics office showed. A Reuters poll had forecast a 0.1% increase.
Exports to the United States were down 7.9% from June, helping drag down overall goods exports to non-EU partners by 4.5%.
The Trump administration imposed a 15% import tariff on most goods from the EU under a deal reached with the 27-nation bloc in July that aimed to avert a trade war between the two economic heavyweights, which account for almost a third of global trade.
The U.S. was Germany's biggest bilateral trading partner in 2024 with two-way goods trade totalling 253 billion euros ($297 billion), and the export-oriented German economy is expected to be badly affected by the levies.
Monday's data coincided with the release of the Sentix survey of investor sentiment, which showed investor morale this month in the euro zone plunging to its lowest level since April with a particularly steep decline in Germany.
"Economic anxieties are coming back with full force," Sentix said in a statement.
Even as it faced headwinds in the U.S., Germany's exports to EU countries rose by 2.5% in July, a positive development leading some analysts to suggest overall exports may not struggle as much as feared going forward.
The share of German exports going to Central and Eastern European countries reached an all-time high of 12%, the statistics office data showed.
"This suggests some broader resilience, even though the euro has also appreciated against some other currencies," said euro area economist Greg Fuzesi, adding that gains in other regions were offsetting the drop in exports to the United States.
Imports, meanwhile, fell 0.1% from June. And the foreign trade balance showed a surplus of 14.7 billion euros ($17.2 billion) in July, down from 15.4 billion euros in June and 17.7 billion euros in July 2024.
INDUSTRIAL PRODUCTION RISES
Separate data released by the statistics office on Monday showed German industrial production rose by 1.3% in July from June. Analysts polled by Reuters had predicted a 1.0% rise.
The less volatile three-month on three-month comparison, however, showed production was 0.1% lower in the May to July period than in the previous three months.
A monthly fall in production in June was revised down to 0.1% from 1.9%, partly due to corrections from a large automotive firm, the statistics office said.
"Hopes for at least a cyclical recovery in German industry remain alive," said Carsten Brzeski, global head of macro at ING.
Data issued on Friday showed German industrial orders unexpectedly fell by 2.9% in July - the third consecutive monthly decline.
Still, Commerzbank expects production to pick up in the coming months on the back of interest rate cuts by the European and other central banks.
By next year at the latest, the German economy should also benefit from the expansionary fiscal policy of the new government, said Ralph Solveen, senior economist at Commerzbank.
"Even a potentially weaker August figure would not diminish this hope, as it would probably be due to relatively late factory holidays in the automotive industry," he said.
($1 = 0.8534 euros)
(Additional reporting by Daria Bogdanska and Paolo Laudani in Gdansk; Editing by Friederike Heine, Emelia Sithole-Matarise, Kevin Liffey and Joe Bavier)
German exports unexpectedly fell by 0.6% in July due to a sharp decline in U.S. demand, largely attributed to Washington's tariffs on European imports.
Investor morale in the euro zone plunged to its lowest level since April, reflecting growing economic anxieties.
German industrial production rose by 1.3% in July from June, although the three-month comparison showed a 0.1% decline.
The tariffs contributed to a 7.9% drop in exports to the U.S., affecting overall goods exports to non-EU partners, which fell by 4.5%.
Commerzbank expects production to pick up in the coming months, supported by interest rate cuts from central banks and expansionary fiscal policies.
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