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Trade: global nerves fray, Germany hits fresh record in 2018

Credit: Reuters Studio
Published 1 week ago - Duration: 02:02s

Trade: global nerves fray, Germany hits fresh record in 2018

Germany's foreign trade hit a record in 2018, underlining how exposed Europe's largest economy is to the global trading system in a week of warnings on how US/China tariff tensions are impacting the economy.

David Pollard reports.

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Trade: global nerves fray, Germany hits fresh record in 2018

Record numbers for German trade .... Only this time they're perhaps not something to celebrate.

2018 figures show Germany exported 1.3 trillion euros worth of goods - and imported 1.1 trillion - exceeding a record set the year before.

They also show how exposed Germany is to global trade flows and US/China tariff tensions - and Brexit ..... In a week of warnings.

On Thursday, the euro zone downgraded its growth outlook .... And the Chambers of Commerce in Germany itself almost halved its forecast in Europe's largest economy .... From 1.7 to 0.9 percent.

(SOUNDBITE) (German) DIHK CHIEF EXECUTIVE, MARTIN WANSLEBEN, SAYING: "In particular, industry is suffering from external faults.

Not only exporters, but also suppliers and service providers in Germany linked to that are affected." Smaller, emerging markets will also take a big hit along with major economies, the UN warned ... If the US goes ahead with a threatened hike in tariffs on China.

(SOUNDBITE) (English) UNCTAD INTERNATIONAL TRADE DIVISION DIRECTOR, PAMELA COKE-HAMILTON, SAYING: "There will be currency wars, and devaluation.

Stagflation, leading to job losses and higher unemployment, and more importantly the possibility of a contagion effect." March 1 now a key deadline .... That's when the US has demanded a new trade deal be in place .... Or it will up tariffs on 200 billion dollars of Chinese goods from 10 to 25 per cent.

Hopes of progress in US/China talks took a major hit on Thursday .... When Donald Trump said he would not meet President Xi Jinping before that date after all.

The news triggered sharp sell offs in US and Asian stocks.

On the month, Germany's trade figures were better than expected - suggesting its own slowdown may be delayed.

But markets are already turning their attention to next week .... And a possible new twist in the tale when China releases its trade data, on Thursday.

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