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The largest economy in Europe suffers a decline again, Germany takes the hard hit, here is what is expected to happen
Written by SOT.COM.AL 25 Maj 2023
Germany has faced an unpleasant situation, as the country's economy has officially gone into recession, although only with a 0.3% decrease.
The figures of the financial statistics institutions showed in the first 3 months of the year a contraction of the German economy, thus marking the second quarter in a row with economic contraction.
Data published on Thursday by the Federal Statistical Office show that Germany's gross domestic product fell by 0.3% in the period from January to March. This follows a 0.5% contraction in Europe's largest economy during the last quarter of 2022.
Two consecutive quarters of contraction is one definition of a recession, although economists at the euro zone's business cycle meeting committee use a broader set of data, including employment figures.
Employment in the country rose in the first quarter and inflation has eased, but higher interest rates will continue to weigh on spending and investment, said Franziska Palmas, senior economist for Europe for Capital Economics.