Germany Economy To Face Recession

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Germany Economy To Face Recession

Germany's Economy To Face Recession In 2024

One of the leading economies of Europe will likely experience a recession during Q1 2024. The economy in question is Germany, which showed consistent negative GDP numbers during 2023's last quarter.

Its negative growth will continue during Q1 2024 as well. This has urged the businesses in the country to look to the government for help.

Negative Growth In 2023 To Carry Into 2024

In Q4 2023, the GDP growth was -0.3% compared with the results from Q3 2023, according to the statistics office. As for what caused the contraction, experts cite high energy prices, consistent inflation, and a slowdown in foreign demand.

In the paper, Germany managed to avoid recession in technical terms, but it will not last long. According to experts, the Q1 2024's growth will be -0.2%, confirming the recession.

An economist from Commerzbank added that private consumption would not be as helpful for the German economy as some people expect it to be. They said the business climate indicator is low while industrial production has also decreased.

The experts from the Hauck Aufhaeuser Lampe are also not optimistic and believe that Germany's economic output has stopped. In simple terms, the German economy is going through a period of no growth.

When we combine these recession forecasts with harmful data from Germany, things are getting messy fast.

To make matters worse, the Chancellor of Germany is also pursuing a costly transition from fossil fuels towards green economy initiatives.

In the last few days, a lobby group also requested the German government to take appropriate measures that could make Germany an attractive place for industries. They added that structural challenges are present in Germany's economy, which requires timely solutions.

And if the German economy enters into recession during the start of 2024, we can only imagine what could transpire in the rest of the European economies.

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