German exports dropped more than expected in March, official data showed Wednesday, as outgoing trade with Russia tumbled in the wake of the invasion of Ukraine.
Exports dropped by 3.3% on the previous month to a value of 120.6 billion euros ($126.8 billion), the Federal Statistical Office said, having risen by a revised figure of 6.2% in February.
A Reuters poll had predicted a month-over-month fall in exports of 2%.
Sales to Russia plunged by 62.3% in March compared with February to 0.9 billion euros partly because of sanctions imposed as a result of the war in Ukraine, the office said in a statement.
A wave of companies shut their operations and halted exports to Russia, with which German business has traditionally maintained strong business ties.
Following the invasion, Russia dropped to 26th place among Germany's export partners, having sat in the 15th spot just a month ago.
In addition to direct losses in business with Russia and Ukraine, economists believe that worsening supply bottlenecks and shortages of intermediate products are likely to have a braking effect on the economy.
Meanwhile, exports to China, among Germany's most important trading partners, suffered a considerable 4.3% drop, as the Asian giant managed a series of punishing lockdowns as it battles to control the spread of the coronavirus.
The release was the "first hard data on the economic impact from the war in Ukraine," said Carsten Brzeski, head of macro at the ING bank, adding that the outlook for exports "doesn't look encouraging."
New lockdowns in China and the aggravation of supply bottlenecks caused by the war in Ukraine "will leave significant marks on German industry," Brzeski said.
Overall, exports to non-European Union countries were down by 5.1%, while inside the bloc the figure fell by 1.7%.
At the same time, imports to Germany rose by 3.4% on the previous month, up to a value of 117.4 billion euros.
Germany had a seasonally adjusted trade surplus of 3.2 billion euros, the office reported, versus a forecast of 9.8 billion euros.
Year-over-year, export growth eased to 8.1% from 14.5% in February. Likewise, imports rose 20.1%, following February's 25% increase.
