Germany harbours world’s largest currency account surplus, says IFO

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Germany harbours world’s largest currency account surplus, says IFO

Earlier in the Asia-Pacific trading hour on Monday, the 3rd of February 2020, the Munich-based Ifo Institute of economic research said in a statement that Germany had scored the world's largest current account surplus last year, remarking the nation’s largest current account surplus across the globe for fourth straight year in a row.

The Ifo estimate, scheduled to be published later but seen by a press agency report, had also added that Germany’s current account surplus that acts as an indicator of the flow of investments, services and products, stood at a lump-sum of $293 billion at the end of 2019, while according to the Ifo measurement, Japan’s current account surplus has been the second-largest with $194 billion as of December 31st, 2019.

In point of fact, latest Ifo estimate would likely to prompt up a pandemonium from the European Commission alongside International Monetary Fund, both of which had long been urging German Chancellor Angela Merkel to revamp the nation’s fiscal policy to heighten up domestic demands and imports, while even the US president Donald Trump had also criticized an extremely export-oriented economy of Germany.

Meanwhile, adding that Germany’s currency account surplus rose €16 billion last year to roughly 7.6 per cent of the nation’s entire GDP (Gross Domestic Product), an Ifo economist, Christian Grimme said on Monday (February 3rd) morning, “Stronger exports to the U.S.

due to the stronger depreciation of the euro and increased exports to the UK, where demand recovered somewhat, saw total German exports rise sharply again in the second half of the year. By contrast, imports expanded very weakly in the summer half of 2019 - the ongoing industrial recession in Germany severely curbed imports of intermediate goods. ”