You are leaking from the oring is my guess. They get smoothed over after awhile. I am not sure what size it is, if you go over to e46fanatics and search their you will probably find a few threads about that.

We have oring shops here that sell things like that and maybe you have one too. The only thing is they will not sell you just one, usually you have to buy a like 10 or 20.

My Nissen radiator I replaced on my e46 came with a spare oring for that hose. I would contact them and ask them what size it is and maybe they can help you source one.

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2004 E60 545i Sport 6MT. Black/Black Build Date 6-2004 102k miles