The gross domestic product declined between April and June by 0.1 percent compared to the previous quarter, the Federal Statistical office. In the first quarter, the German economy still grew by 0.4 percent.
Watch the Video
Weakness of the German economy
A recession threatens Germany?
International trade conflicts and the slowdown in the global economy have slowed the export-oriented German economy in the second quarter. The gross domestic product (GDP) shrank by 0.1 percent compared to the previous quarter, according to the Federal Statistical office on the basis of provisional data.
Slowed the development was the foreign trade. Exports of Goods and services decreased compared to the previous quarter, stronger than the imports. Private consumption expenditure increased, however, the companies have invested more. Construction investment, however, were after a strong increase at the beginning of the year due to relatively mild winter on the decline.
Euro zone is still growing – in spite of Germany
The Eurozone has grown, in spite of the slight contraction in its biggest economy, Germany. The gross domestic product increased 0.2 percent, the statistics office Eurostat announced. It confirmed an earlier estimate. The start of the year it had reached a Plus of 0.4 percent. For comparison: The world’s largest economy USA made in the spring, an increase of 0.5 percent.
Eurostat confirmed an initial estimate of the end of July. Compared with the prior-year quarter, the growth of the 19 Eurozone countries was 1.1 percent. The 28 countries of the EU grew compared to the previous quarter, also 0.2 percent, compared to the prior-year quarter by 1.3 percent.
Of the large Euro-area countries, Germany performed the most poorly. “From the former pattern boys a worry has become a child,” said the chief economist of the banking house lamp, Alexander Krüger. The number two in France, by contrast, increased by 0.2 percent, while the number stagnated for three Italy. Spain and the Netherlands even managed a Plus of 0.5 percent.
The grounds are also home-made
Above all, the consumer is based in Europe’s largest economy. The people are in the face of low unemployment in the consumer mood. In addition, Saving throws, because of the interest rate downturn, there’s barely anything. Finally, the consumer were to spend according to the GfK consumer researchers when it comes to money, however, is more cautious. Messages about staff cuts and the introduction of short-time work were the fear of loss of job grow, said GfK consumer climate expert Rolf Bürkl recently.
The slowdown in the global economy, the uncertainties due to the trade conflict between the United States and China, as well as the vagaries of the Brexits the German industry burden. Add to this the structural change in the auto industry through electric mobility.
Mario Ohoven, President of the Federal Association of medium-sized economy, disagreed with the statement, the decline in economic performance was due solely to external influences. On the contrary: “The hard landing for the economy is done in-house. The main reason for the threat of a recession is the wrong priorities of the Federal government.” This Ohoven, “investment impulses called for a reduction of unemployment contributions, a free amount of periods in the calculation of the social tax, faster Depreciation, a reduction in the corporate tax rate to 14 percent, as well as a full abolition of the solidarity surcharge.”
The prospects are not rosy
For the third quarter of hoped-for economic recovery is to last, rather weak data, according to Economists, are increasingly in question. “Germany’s economy is on the Brink”, said Sebastian Dullien, scientific Director of the Institute for macroeconomics and economic research of the trade Union of the Hans-Böckler-Foundation.
The managing Director of the German chamber of industry and Commerce day (DIHK), Martin Wansleben, said the current Figures are as follows: “After the good start, the company arrived in the hard economic reality.” A improvement is not expected Wansleben: “Currently, there is no change in sight. In the DIHK business survey, the companies report a significantly darkened the Outlook. The business expectations are declining in all sectors. The expectations of the foreign business are as low as in the last ten years. If we here are not against taxes, the German economy in times of economic slowdown really in the pliers.”
The Chancellor wants to act in a “situation”
The Director of the Institute for macroeconomics and economic research (IMK), Sebastian Dullien, see “Germany’s economy on the Brink.” The IMK had expected “as the other leading economic research institutes, in order that it would come in the second half of the year, a rapid recovery of the economy and, in particular, of the industry. The chances for such a Positive scenario are now dropped significantly.”
German Chancellor Angela Merkel sees currently no need for stimulus packages. Although the economy is in a “difficult Phase”, said the CDU politician on Tuesday in Rostock, Germany.
Merkel warned, but about to speak, the economic situation is bad. “We will act according to the situation.” For the full year, the Federal government most recently expected an economic growth of 0.5 percent. In the past year, the gross domestic product had risen a total of 1.4 percent.
dk/hb (afp, rtr, dpa)
Watch the Video 03:33 Share
What’s the significance of the GDP?
Facebook Twitter google+ send Tumblr VZ Xing Newsvine Digg