Carsten Brzeski, chief economist at ING, factors out that the German economic system grew by just one.5% YoY and had its weakest efficiency in 5 years in 2018.
“An official estimate of fourth-quarter progress will solely be accessible in February however with 1.5%, it appears as if a technical recession might solely simply have been prevented. On the identical time, the statistical company recorded a report excessive fiscal surplus of 1.7% GDP.”
“The principle motive for the sudden cooling of the economic system within the second half of the yr is automobiles. Missed deadlines for the admission of latest emission requirements have led to an infinite stock build-up within the second and third quarter of the yr and a consequently very weak gross sales and now manufacturing performances. Additionally, the introduced ban on automobiles with previous diesel engines for a number of German cities has not solely weakened automobile gross sales but in addition led to precautionary financial savings of households over the summer time months.”
“It at the moment appears as if the German economic system might get away with one black eye however today, financial energy in Germany would not come effortlessly.”