Germany: negative economic growth in the third quarter
Germany is almost happy to be in slight decline. The German economy contracted by 0.1% in the third quarter of 2023, marking a reversal from the upwardly revised expansion of 0.1% recorded in the previous three months and beating market expectations of a contraction of 0 .3%, according to a preliminary estimate.
Private consumer spending has put downward pressure on GDP , driven by rising interest rates and persistently high inflation.
In contrast, equipment investments saw growth during this period. On an annual basis, GDP fell 0.3% after remaining unchanged in the previous period, in contrast to market expectations of a 0.7% decline.
Here is the relevant graph
Real German GDP, seen in absolute value, is in fact decreasing:
The continuous negative data from the PMI indicators are gradually but inexorably transforming into general negative economic data, starting with GDP. If 31% of Germans are turning politically to two sectors, on the right and on the left, which do not recognize themselves in the current economic and political mainstream, which view green policies with skepticism and want to limit immigration.
Having lost the energy advantage of direct exchange with Russia, Germany is demonstrating that all its production advantage was linked only to the energy contingency and that now, that this has disappeared, not much remains of German competitiveness. The fees are much higher than their Eastern European competitors. Why should one invest in Germany when one can find a favorable economic environment in Czechia, Poland and Hungary and have costs that are fractional compared to those in Germany?
It is no coincidence that the countries mentioned above do not have the Euro…
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The article Germany: negative economic growth in the third quarter comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/germania-crescita-economica-negativa-nel-terzo-trimestre/ on Tue, 31 Oct 2023 06:30:50 +0000.