April 15, 2021

Germany escapes recession

Germany escapes recession


The German economy managed to dodge its entry into technical recession by just a couple of hundredths in the last quarter of 2018, when its GDP stagnated compared to the previous three months, which had already declined two tenths, according to the Federal Statistics Office (Destatis), which has revised its first growth estimate for the whole of 2018 one tenth downward, leaving it at 1.4%, its worst record in five years.

Although the German country has escaped the recession, the engine of the European economy has confirmed its slowdown. After having grown four tenths in the first quarter of 2018 and half a point in the second, contracted by 0.2% between July and September and recorded a negligible expansion of 0.02% in the last three months of the year.

In the set of last year, the German economy recorded a growth of 1.4%, one tenth less than originally estimated, which represents the weakest expansion rate of the 'European locomotive' since 2013. Despite the slowdown registered in 2018, Germany has nine consecutive years of growth in what is already the longest expansion phase of the country since 1966. The German statistical office noted that in the fourth quarter of last year, Germany had 45 million employed, figure which represents an annual increase of half a million people compared to the same period of 2017.

At the end of January, the German government cut its growth forecast for its country by eight tenths, leaving it at 1%, as a result of the negative impact of external factors such as the uncertainty surrounding Brexit and commercial tensions. This "hack" of Berlin exceeded even the pessimism expressed earlier this year by the International Monetary Fund, which came to cut the economic projection of the "European locomotive" by six tenths, up to 1.3% for the current year.

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