Robert Besser
03 Feb 2023, 01:01 GMT+10
FRANKFURT, Germany: Data released this week showed that the German economy unexpectedly shrank in the fourth quarter of 2022, indicating that Europe's largest economy could be entering a recession, though less severe than originally predicted.
The federal statistics office said that adjusted gross domestic product (GDP) decreased 0.2 percent quarter-on-quarter in adjusted terms, while in the previous quarter, the German economy grew by 0.5 percent, compared with the previous three months.
A recession, defined as two successive quarters of contraction, has therefore become more likely.
"The winter months are turning out to be difficult, although not quite as difficult as originally expected. The severe crash of the German economy remains absent, but a slight recession is still in the cards," said VP Bank chief economist Thomas Gitzel, as quoted by Reuters.
In the government's annual report released last week, German Economy Minister Robert Habeck said that the economic crisis caused by Russia's invasion of Ukraine was manageable, but the government is remaining cautious due to high energy prices and interest rate increases.
The economic situation should improve from spring onwards, the government said, after revising its GDP forecast for 2023 by predicting growth of 0.2 percent, up from a forecast in autumn of a 0.4 percent fall.
Declining private consumption was the primary reason for the decrease in fourth-quarter GDP, this week's figures showed.
"Consumers are not immune to an erosion of their purchasing power due to record high inflation," noted Commerzbank chief economist Joerg Kraemer, according to Reuters.
Get a daily dose of Tennessee Daily news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Tennessee Daily.
More InformationNEW YORK, New York - U.S. stocks extended their rally on Friday despite remarks by Federal Reserve Chair Jerome Powell ...
MOSCOW, Russia: Russia's trade in oil with India, one of the most lucrative oil trade routes since the imposition of ...
LONDON - Health experts and tobacco campaigners have strongly criticized New Zealand's decision to repeal laws that aimed to ban ...
NEW YORK, New York - The Dow Jones index was the standout on U.S. financial markets on Thursday with a ...
WASHINGTON D.C.: Despite the ongoing economic uncertainty, major discounts during the Thanksgiving weekend enticed U.S. shoppers, who spent some US$38 ...
BANGKOK, Thailand: This week, Thailand's Deputy Finance Minister Krisada Chinavicharana said after a weaker-than-expected third quarter, the country will downgrade ...
WASHINGTON D.C.: After a House Ethics Committee report found substantial evidence that he broke the law, New York Republican representative ...
WASHINGTON D.C.: Despite the ongoing economic uncertainty, major discounts during the Thanksgiving weekend enticed U.S. shoppers, who spent some US$38 ...
WASHINGTON D.C.: U.S. First Lady Jill Biden stressed that she wants everyone visiting the White House during Christmas to "feel ...
While Secretary of State Anthony Blinken has been frantically shuttling around the Middle East trying to stop the Israeli coflict ...
COLUMBUS, Ohio: To stop the spread of bird flu, more than 1.3 million chickens will be killed on Ohio's Union ...
WASHINGTON D.C.: President Joe Biden invoked a Cold War-era act this week to boost investment in U.S. manufacturing of medicines ...