Wed. Aug 21st, 2019

Germany saves at the last minute and closes 2018 with a growth of 1.4%

Germany saves at the last minute and closes 2018 with a growth of 1.4%


MadridUpdated:

The German economy has added its ninth consecutive year of growth and closed 2018 with an expansion of 1.4%, according to the final data published this Thursday by the Federal Statistical Office (Destatis), which reduces the advance by one tenth in the month of January.

The gross domestic product (GDP) of Germany Stagnated in the fourth quarter (0.0%) and prevented the European locomotive from entering recession, after the fall of 0.2 percent registered in the third quarter. The experts talk about a «Technical recession» when the GDP falls in two consecutive quarters, which in Germany happened for the last time between the last quarter of 2012 and the first of 2013.

The stagnation of the fourth quarter confirms, according to Destatis, the contrast between the second and the first part of the year when there had been growth of 0.4% in the first quarter and 0.5% in the second quarter.

In the year-on-year comparison it has been registered a slowdown in growth. In the fourth quarter, with respect to the same period of the previous year, the GDP grew by 0.9% after having increased 1.1 percent in the third, 2.3% in the second and 1.4 percent in the first.

Commercial war and conjuncture

The slowdown has been attributed to the Weakness of the global situationand the turbulence in business relationships with the US that have affected exports. Added to this are the problems of the automotive industry, one of the fundamental pillars of German industry.

An additional factor was the sfair in the summer that hindered the fluvial transport of some goods within Germany. On the positive side, according to Destatis, there was an increase in investments in equipment by companies.

Private consumption has increased slightly while public spending had a clear upturn. The year 2018 was the ninth year consecutive growth for the German economy. However, the institutes of economic studies, international organizations and the federal government have revised their forecasts to the downside for 2019 due to the problems of foreign trade.

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