2023-07-29 18:47:41
Germany barely managed to emerge from the winter recession in the second quarter of 2023 with its gross domestic product (GDP) stagnating in the second quarter, doing much worse than expected, the Destatis institute said on Friday.
The GDP of Europe’s largest economy shows zero growth between April and June over one quarter, after having fallen successively by 0.4% and 0.1% in the two previous quarters, according to revised data and corrected for seasonal variables and schedule (CVS).
Factset analysts expected them to rebound 0.3% in the second quarter. Over one year, the indicator is down 0.2%, still in CVS data.
Private household consumption expenditure “stabilized in the second quarter of 2023 after the weak winter semester”, details Destatis.
This is due to a job market that remains solid, wages that have risen sharply and a downward trend in inflation.
According to previous indicators, industry and construction, on the other hand, were unable to increase their production compared to the previous quarter, although supply difficulties were reduced and they benefited from a large order book.
Rising financing costs dampened domestic demand, and the industry was further slowed by lower foreign demand.
If German GDP has more or less left behind the technical recession – i.e. two quarters in a row in decline – it went through this winter, this could only be a parenthesis: the purchasing managers’ index (PMI) for July , in decline, pointed to a further decline in GDP during the current quarter, unless the months of August and September show a clear reversal in trend.
The German economy could also end the year in the red overall, at the back of the pack of euro zone countries.
The main economic institutes are now expecting a decline estimated between 0.2 and 0.4%, the IMF for its part expecting -0.3%.
Olaf Scholz’s government still sees GDP growth posting 0.4%, but this April forecast has a good chance of being lowered in the fall.
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