Germany’s GDP fell by 0.2%, not as significant a decline as had been estimated. Technical recession alarm bells are ringing, but economists believe that if it does come it will not be deep.
German Gross Domestic Product (GDP) contracted in the fourth quarter of 2022, making the possibility of Germany entering a technical recession all the more real, which, for some economists, should not be as deep as feared.
The contraction of the GDP was 0.2% in the fourth quarter compared to the third, indicates Reuters, based on data from the German statistical authority. The result was surprising since specialists listened to by the news agency pointed to a stagnation in the face of the most recent signals. In the previous quarter, the German economy had grown by 0.5% compared to the second quarter.
A recession is, in technical terms, a contraction of the economy for two consecutive quarters. This scenario in Germany becomes more likely with the figures now published, since, says Reuters, several economists point to a new contraction in the first quarter of this year.
Economy in “more favorable” situation than feared, says German minister
“The winter months are being difficult, although not as much as initially expected,” the chief economist at VP Bank, for whom recession is a possibility, but slight and not deep, told the news agency.
Last week, the German Economy Minister argued that the country’s economic situation was “more favourable” than feared in the fall. This confidence was also shared by the group of experts Ifo, which last Wednesday indicated that the German economy was likely to escape the recession.
The German government expects the German economy to grow by 0.2% in 2023, an improvement on previous forecasts of a 0.4% contraction.
Source: Observadora
