Frankfurt Skyline at dusk in November.
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The German economy shrunk in the third quarter of the three months in December, which ended in December, according to a spare data announced by the Statistics Bureau in the German Statistics on Thursday.
This number is adjusted according to the price, calendar, and seasonal variations.
The analysts voted by Reuters expected that the gross domestic product (GDP) would decrease by 0.1 %.
Despite the increase in households and government consumption spending, Destatis said that exports were “low” than the previous quarter.
“After a year due to economic and structural issues, the German economy ended in a negative area in 2024.”
“This slump is likely to lead to a recession in winter,” said CARSTEN BRZESKI, a global head of ING.
German issues seem to be concentrated in the national industry, but this could change, he said in a Thursday memo.
“Given the importance of the industry as a whole, the ripple effect on other sectors is already happening through actual economic channels, regardless of emotion.”
According to BRZESKI, important industries have not been set as “substantial recovery” because of inventory, ordering issues and exports to US loofs.
Thursdays are compared to the 0.1 % increase in GDP in the third quarter of last year. German economic performance is long, and the GDP measured value every quarter has been mainly floating around the flat line in the past two years. However, the economy was able to avoid the technical recession.
Every year, the German economy contracted 0.3 %, 0.3 %, respectively, between 2023 and 2024.
In 2025, some rests are expected, and the German government has announced the annual growth of 0.3 % per year on Wednesday.
According to a CNBC translation, “the diagnosis is serious,” said Robert Havec, the Minister of Climate, at a press conference on Wednesday.
He added that the German economy has been stagnant for a long time. He pointed out both internal and world’s political uncertainty as a factor that leads to a reduction in expectations, and the retirement government can fully implement its growth plan as the term ends early. I added that it wasn’t.
Federal elections in Germany are scheduled for February 23. This is scheduled earlier than initially planned due to the dissolution of the ruling parties of the country at the end of last year.
Havec also stated that there was a structural problem with the focus on the German economy, reflecting the comments made by Finance Minister of Finance last week.
“We must deal with our structural weaknesses in our economy,” Cuquace told CNBC. “It is really important that we will start the path of economic growth.”
