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Germany Heading Towards Recession, Says Government Report


Added 08-24-19 12:38:01pm EST - “Europe's largest economy registers negative growth in two successive quarters” - Legalinsurrection.com

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Posted By TheNewsCommenter: From Legalinsurrection.com: “Germany Heading Towards Recession, Says Government Report”. Below is an excerpt from the article.

Germany is heading into a recession, a report released by Chancellor Angela Merkel’s office said. The economists working at the Chancellor’s office see Germany technically in a recession given the country’s negative growth in two successive quarters, the German weekly Der Spiegel reported. Europe’s largest economy is expected to contract between July and September, as it did in the second quarter.

The admission comes just days after the German Economy Ministry announced that the country was not in a recession. Despite grim official projections, Merkel’s government continues to downplay the economic fears. “The German finance minister doesn’t seem to be in a hurry,” the public broadcaster Deutsche Welle reported this week, “though, indicating that a stimulus package will only come if and when Germany is in a very pronounced recession.”

In June, Germany’s industrial production fell by 5.2 percent compared to last year, the biggest decline since the financial crisis of 2008. A no-deal Brexit could further weigh down Germany’s shrinking economy, economists at the Chancellor’s office believe. “The German government thinks that there is a “high probability” of a no-deal Brexit,” the London-based Financial Times confirmed.

The Chancellor’s office expects a continued downturn in German economy for this year. “There are emerging signs of a slight decline in the gross domestic product (GDP) for the third quarter, and thereby a technical recession,” a chancellery documents [obtained by] Der Spiegel said.

In the second quarter, the economic output contracted by 0.1 percent as compared to the previous quarter. The exports [working for] Chancellor Angela Merkel (Christian Democratic party) see a similar decline between July and October. If an economy declines for two quarters in a row, this is usually defined as a recession. “A series of early indicators signal a weak industrial output continuing well within in the second-half of the year,” [the document said].

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