Leading economic researchers see an end to the economic upswing in Germany. The institutes cut their growth forecast for this year. The orders for the industry are already broke in.
The leading economic institutes call the end of a year-long economic boom in Germany. For 2019, you stomped your forecast for the growth of the gross domestic product to 0.8 per cent, after they had expected in the autumn with 1.9 percent.
“The long upswing of the German economy is coming to an end,” says the Vice-President of the Institute for economic research Halle (IWH), Oliver repeated möller, published on Thursday in community diagnosis. “The risk of a pronounced recession, however, so far, for the low.” For 2020, the experts predict unchanged, a growth of 1.8 percent.
Hard Brexit as a threat
It comes to a non-EU apply in the UK outlet the economy is likely to be growth, both in this and in the coming year, according to the opinion of economic researchers, “significantly lower” than previously estimated. Risks, the experts also see the unresolved trade dispute between the world’s two largest economies, USA and China. National experts put a brake defect, supply shortages, and difficulties in the auto industry and the economy.
Federal Minister Peter Altmaier expects in spite of the growing Concerns with an early end to the economic downturn. “In the second half of 2018, the observed slowdown in the overall economic development will be overcome in the course of this year gradually, and the buoyancy forces gain the upper hand,” said Altmaier, after the publication of the community diagnosis. “This year will revive the economy, without, however, the high dynamics of lying back to reach the years,” said the CDU politician.
Risks by the economic policy
“The German economic policy creates risks, for example, by charged increased, the long-term stability of the statutory pension insurance by a significant Performance, which will not be financed from the contributions to”, to criticise the institutions. “This allows tax increases to be expected that Germany as a location for investment less attractive.” The policy should be more closely geared to improve the investment environment.
The increase in Employment is likely to continue, although is Fort, but to lose momentum. The number of employed persons is expected to rise by 2020 to 45.5 million, which would be approximately 700,000 more than in 2018. At the same time, the number of unemployed is expected to fall to 2.1 million. Despite the gloomier economic experts are forecasting surpluses with continued strength in the State. In the current year, Plus to be 41.8 and 2020 to EUR 35.6 billion.
The community diagnosis serves the Federal government as a Basis for their own forecasts, which in turn form the basis for the tax estimate. It had halved its estimate for this year, most recently to 1.0 percent and in the coming year, a Plus of 1.6 percent. Is developed in the report by RWI Essen, DIW in Berlin, Ifo in Munich, IfW in Kiel and IWH in Halle.
Industry jobs with a strong order-to-break-in
At the same time, the Federal Ministry of Economics announced that the German industry has suffered in February, is surprisingly the strongest drop in orders in more than two years. Thereafter, the new business shrank, mainly due to weak external demand by 4.2 per cent month-on-month. Economists polled by Reuters had expected an increase of 0.3 percent.
Already in January, the orders were down by 2.1 percent. “In the coming months, demand is expected, particularly due to a lack of foreign to continue with a subdued Industrial activity,” said the Ministry. The weak global economy, trade conflicts and the Brexit strain currently.
Economists surprised
Economists were of the downward momentum surprised. “The data are a bitter disappointment,” said Andreas Scheuerle of DekaBank. “Once again, it is the world economy, forcing the German industry to its knees. The turnaround in the global economy is extremely and especially from the Asian Region.”
Jens-Oliver Niklasch of LBBW said it was a major setback: “The industrial economy is almost in free fall.” A good part of it is likely to go to the high level of uncertainty in terms of Brexit. Will be eliminated or the terms of the UK – one of Germany’s Top trade partner from the EU, is still unclear.
Hope for China
Hope for a trend reversal to some experts, the development in China. “The orders indicate a clear downturn,” said the chief economist of VP Bank, Thomas Gitzel. “How long this lasts, depends now crucially on how long it takes for the Chinese government’s economic stimulus measures have on the local continent to have a positive effect.” China, for example, has reduced the VAT and billions of infrastructure investments announced. The people’s Republic is Germany’s most important trading partner.
The industrial orders from the domestic market fell in February by 1.6 percent, foreign orders declined 6.0 percent. The orders from the countries fell outside the Euro-Zone, with 7.9 percent, is particularly pronounced.
ul/hb (rtr, dpa)