German economy is facing two consecutive quarters of contrac...| MENAFN.COM

Friday, 31 March 2023 09:32 GMT

German economy is facing two consecutive quarters of contraction

(MENAFN) At a news conference last week where he presented the most recent predictions, Economy Minister Robert Habeck claimed that the German economy is expected to decrease for two straight quarters.

The projection for the nation's gross domestic product (GDP) in this year was changed in the report to 0.2 percent growth this year. The administration had predicted a 0.4 percent reduction in GDP for this year back in the fall. The recent decline in energy costs has also improved the prospects for inflation. The previous prediction of 7 percent price rise for the year has been revised down to 6 percent.

Habeck declared that although the nation's economy would avoid a dramatic downturn, “it’s still likely that we’ll have a technical recession.”

He also mentioned that “the message is that we have made the crisis manageable… This does not mean that the crisis is over. But we were able to avert the worst scenarios.”

Two quarters of negative growth constitute a technical recession. Nevertheless, according to Habeck, the third and fourth quarters of the current year could see an improvement.


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