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Germany likely to head into recession, central bank warns
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| Contributor | IndyGeorgia |
| Last Edited | IndyGeorgia Aug 19, 2019 06:47pm |
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| Category | News |
| Author | Phillip Inman |
| News Date | Monday, August 19, 2019 08:00:00 PM UTC0:0 |
| Description | Germany’s economy is heading into recession after the country’s central bank warned that a slump in exports during the summer was likely to continue into the autumn.
The Bundesbank said a downturn in orders for cars and industrial equipment in the second quarter of the year was likely to continue in the third quarter, leaving the economy on the brink of a technical recession, defined as two consecutive quarters of negative GDP growth.
The bank, blaming a drop in exports, said Brexit and the trade war between the US and China were among the factors responsible for a 0.1% drop in GDP in the three months to June and would likely create a similar drop in the three months to September.
It said: “The overall economic performance could decline slightly once again. Central to this is the ongoing downturn in industry.”
Forecasts of growth this year of 0.5% by the Bundesbank and the European commission are likely to be downgraded to nearer 0.2% or 0.3%, though analysts at Deutsche Bank said even these figures were vulnerable to downward revisions. |
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