Germany GDP

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Germany: Economy flirts with recession

November 14, 2014

In the third quarter, GDP increased a lackluster 0.1% over previous quarter in seasonally-adjusted terms, according to a flash estimate released by the Federal Statistics Office (Destatis) on 14 November. The reading came in just above the revised 0.1% contraction registered in the second quarter (previously reported: -0.2% quarter-on-quarter) and was on par with market expectations. Destatis also mentioned that the economy grew a stronger 0.8% in Q1, which was revised up from the 0.7% rise previously estimated. Compared to the same quarter last year, GDP rose from 1.0% increase in Q2 to a 1.2% expansion in Q3.

According to Destatis, preliminary data showed that positive contributions to overall economic growth came from private consumption and from the external sector as, according to Destatis, “the increase in exports was higher than that of imports.” Conversely a drag on growth stemmed from deterioration in fixed investment, particularly from investment in machinery and equipment, which was, “considerably down on the previous quarter.” In addition, investment in construction also fell over the previous quarter. More complete data will be released on 25 November.

The government expects the economy to increase 1.2% in 2014. For 2015, the government sees economic growth picking up just to 1.3%. FocusEconomics Consensus forecast panelists expect economic activity to expand 1.9% in 2014, which is down 0.1 percentage points from last month’s forecast. For 2015, the panel also forecasts GDP growth of 1.9%.


Author: Teresa Kersting, Economist

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Germany GDP Q3 2014 1

Note: Quarter-on-quarter changes of seasonally adjusted GDP and year-on-year variation in %.
Source: Federal Statistics Office (Destatis) and FocusEconomics Consensus Forecast


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