Germany’s record trade surplus fuels US dispute

Germany gave more fuel to its US critics in the administration of Donald Trump as the eurozone’s biggest economy produced a record trade surplus last year.

The nation — a major exporter with a significant trade surplus in the US — has raised the hackles of the US President’s top trade adviser Peter Navarro, which accuses it of exploiting other European Union countries and the US through a “grossly undervalued” euro.

Chancellor Angela Merkel rejected the charge, stressing the independence of the European Central Bank.

But official figures showed that Germany’s 2016 trade surplus jumped to €252.9 billion (£215.4 billion) — surpassing the previous year’s high of €244.3 billion.

“The record surplus will continue to fuel the conflict with the USA and within the EU,” German economist Marcel Fratzscher, head of the DIW economic institute, said.

Merkel has warned that the EU would press ahead on trade deals with other countries if it does not reach an agreement with Trump’s administration.