German economy stagnated in Q4

Growth ground to a halt at the end of the year in Germany, Europe’s largest economy, as manufacturing remained in a slump and exports fell. The figure underlines the challenge facing the eurozone.

The state statistics agency said yesterday there was zero growth in the fourth quarter and a mediocre 0.6 per cent increase for the whole year.

Germany’s troubles are a central problem for the 19-country eurozone economy and the European Central Bank, which is trying to stimulate flagging growth and inflation with negative interest rates and bond purchases with newly printed money. Germany has been a manufacturing and export champion in recent years but those areas have been sluggish while consumer spending and services businesses have held up better and kept the country out of recession.

Carsten Brzeski, chief economist at ING Germany, said that recent hopes for a modest upswing were looking a little premature at this point. “In general, the German economy remains stuck between solid private consumption and a paralyzed manufacturing sector,” he said in an email.

 

German economy stagnated in Q4

Growth ground to a halt at the end of the year in Germany, Europes largest economy, as manufacturing remained in a slump and exports fell. The figure underlines the challenge facing the eurozone. The state statistics agency said yesterday there was zero growth in the fourth quarter and a mediocre 0.6 per cent increase for the whole year. Germanys troubles are a central problem for the 19-country eurozone economy and the European Central Bank, which is trying to stimulate flagging growth and inflation with negative interest rates and bond purchases with newly printed money. Germany has been a manufacturing and export champion in recent years but those areas have been sluggish while consumer spending and services businesses have held up better and kept the country out of recession. Carsten Brzeski, chief economist at ING Germany, said that recent hopes for a modest upswing were looking a little premature at this point. In general, the German economy remains stuck between solid private consumption and a paralyzed manufacturing sector, he said in an email.