The German economy grew 0.1% in the fourth quarter

0


Robust exports helped Germany achieve 0.1% growth in the last quarter of 2020, avoiding the contraction despite a second wave of the novel coronavirus which dampened consumption in Europe’s largest economy.

Exports of goods and construction have supported the economy while a new foreclosure late last year affected private consumption, the Federal Statistical Office said.

A Reuters poll had indicated zero growth in the fourth quarter.

In the third quarter, the economy grew 8.5%.

“In the fourth quarter, this recovery was slowed by the second wave of coronavirus and the renewal of the lockdown at the end of the year,” the Bureau of Statistics said.

“This has particularly affected private consumption, while exports of goods and investment in construction have supported the economy,” he added.

The German government this week cut its growth forecast for Europe’s largest economy to 3% this year, a sharp revision from last fall’s estimate of 4.4%, caused by a second lockdown of the coronavirus.

Presenting the revised forecast, Economy Minister Peter Altmaier said he expected the recovery to continue in 2022 and the economy to return to pre-crisis levels in the second half of the year. next.

Germany suffered its second biggest economic plunge in post-war history last year.

Chancellor Angela Merkel and heads of state agreed last week to extend the last lockdown until mid-February as Germany, once a model for tackling the pandemic, grapples with a second wave and records a daily number of deaths from Covid-19.

Last year, the economy contracted 5% less than expected. This was only surpassed in the post-war era by the record 5.7% contraction in 2009, during the financial crisis.

A survey released this week showed German business morale fell to its lowest level in six months in January as the second wave of Covid-19 halted the economic recovery.

Meanwhile, German unemployment fell unexpectedly in January, signaling that government incentives for businesses to keep workers on their payrolls during the coronavirus pandemic were protecting the job market in Europe’s largest economy. .

The employment agency said the number of unemployed people in Europe’s largest economy fell by 41,000 in seasonally adjusted terms to 2.729 million.

A Reuters poll predicted an increase of 6,000.

“The labor market remains in a strong state in January,” Federal Labor Agency director Detlef Scheele said in a statement. “But the measures in place to tame the coronavirus pandemic are leaving traces. ”

Germany has been stranded since mid-December as it battles a second wave of the virus.

The unemployment rate was unchanged from the previous month at 6%.

The employment agency said some 2.26 million people had reduced working hours in November under the government’s Kurzarbeit program.

This is designed to avoid massive layoffs during downturns by offering companies grants to keep workers on the payroll.


Share.

About Author

Comments are closed.