Germany’s federal and state tax revenues rose 2% in August from a year earlier to €63.2 billion ($74.4 billion), the finance ministry reported Tuesday, though it cautioned that no near-term pickup in economic momentum is expected.

The eurozone’s largest economy contracted in 2024 for a second straight year and faces fresh pressure from U.S. tariffs given its reliance on exports. Leading indicators, the ministry said, do not suggest “a noticeable acceleration in economic momentum in the short term.”

From January through August, tax revenues increased 6.8% year-on-year to €576.5 billion. For 2025, analysts forecast total tax revenues will rise 3.7% to €893.3 billion. The U.S. remained Germany’s biggest trading partner in 2024, with two-way goods trade reaching €253 billion.

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Rising tax receipts provide fiscal support, but Germany’s growth remains constrained by weak demand and external tariff risks. Heavy reliance on exports leaves Germany vulnerable to U.S. trade measures, a key downside risk.

For now, though, euro supportive.