In its monthly report on the country's economy published by the German Ministry of Economy and Climate Protection, it was stated that the German economy continued to stagnate at the beginning of the third quarter of this year, declining order books and generally weak order status weakened the export-oriented industry.
Despite falling inflation and a significant increase in real wages and a significant increase in purchasing power, consumer sentiment has deteriorated, the report said, ⁇ Economic recovery is not expected until the end of the year ⁇ .
In the report, it is noted that the European Football Championship held in Germany on 14 June-14 July did not give a significant acceleration to consumption, and while it is seen that the championship did not give a significant acceleration to consumption, it is understood that even the significant increases in real wages did not increase consumer sensitivity in the face of increasing concerns about employment.
There is a risk of recession.
The German economy is struggling to grow amid rising interest rates and cyclical winds and structural changes. The economy shrank 0.1 percent in the second quarter due to declining investments.
The Central Bank of Germany expects lower growth in the 3rd quarter, while the Institute for Economic Research (Ifo), one of Germany's leading economic think-tanks, considers a further decline in GDP possible in the 3rd quarter.
The German economy will be in a technical recession if it shrinks in the third quarter. The technical recession is expressed as a reduction in GDP for 2 consecutive quarters. Germany experienced a recession in 2020, the first year of the pandemic after 10 years of good economic growth, for the first time since 2009.
The German government expects the economy to grow by 0.3% this year.
On September 5, Ifo cut the country's growth forecast for 2024 and next year from 0.4 percent to zero due to poor investment and order status.
