Germany defies weak trade data from China

China's year-on-year imports nosedived even more than expected in August, falling 13.8 percent to analysts' earlier forecast of 8.2 percent. Exports, on the other hand, fell less than predicted, sliding by 5.5 percent.

The surprisingly poor data could make it somewhat unlikely that China will reach its full-year growth target for the year of around 7 percent.

The sinking imports were attributable to lower prices for commodities around the world as well as sluggish demand for Chinese products. That's because most of China's imports are raw materials that find their way into factories where they are used in the production of other goods that are then sold abroad.

The fact that imports are slumping now could be a harbinger of tough times ahead for Chinese exports, analysts say. It was the 10th consecutive monthly fall in import values.

Other factors likely to prevent imports from picking up again anytime soon include a devaluation of the yuan that was pushed through early last month and weak consumer demand.

German trade surplus widens

In Europe, businesses urged authorities in Beijing to accelerate reforms in order to stave off stagnation in the economy of the world's No. 1 trader.

Chinese consumers have some of the most voracious appetites for foreign commodities in the world, and if demand there weakens, it can trigger panic on global markets.

But the apparent slump in China wasn't enough to sully fresh trade data from Germany, data showed on Tuesday. German exports and imports both hit record highs in July in terms of value - an indication that interest abroad and at home for German goods has not waned.

Seasonally-adjusted exports rose 2.4 percent to 103.4 billion euros ($115.25 billion), while imports gained 2.4 percent to 80.6 billion euros, leaving Europe's largest economy with a 22.8 billion euro trade surplus.

The positive figures gave a boost to Germany's benchmark DAX share index, which outperformed the broader stock market.

cjc/uhe (Reuters, AFP, AP)