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The below chart explains why the worst is yet to come for the German economy. The country avoided falling into technical recession in Q3 this year due to a rebound in external demand reflecting improved export growth to Turkey and the United Kingdom. However, the economic momentum remains fragile as China, its most important trading partner with a total trade volume of around 200 billion euros (in 2018), is still facing economic turmoil. The latest data shows that Germany export growth to China is at its lowest level since early 2016, at minus 8.2% YoY in October. Based on preliminary trade data, all indicates that the contraction is not over yet, and could get worse in coming months, leading to a new fall in Germany’s manufacturing PMI in December/January.