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The German economy narrowly escapes the technical recession



Germany has been narrowly avoiding the technical recession since recent data show that the country's economy grew by 0.1% in the third quarter.

Germany's GDP (Gross Domestic Product) rate exceeds the contraction of -0.1% expected by analysts. On an annual basis, the economy grew by 0.5% from July to September, the Federal Office for Statistics said. Growth in the second quarter was revised from -0.1% to -0.2% and two consecutive periods of negative growth would be a formal recession.

"No recession, but definitely a very weak economy," Klaus Vistessen, head of the euro

"In a sense, this is the 'worst' of both worlds for markets. Today's data confirms that the German economy is already stagnant, but the headlines are probably not terrible enough for a quick and aggressive fiscal response from Berlin. "

Meanwhile, German Economy Minister Peter Altmeyer said that although data show that the country escaped a technical recession in the third quarter, economic development in the region is still fragile.

Speaking Thursday CNBC's Annette Weissbach, Daniela Schwarzer, Director of the German Foreign Relations Council, noted that there was "only a slight difference" between 0.1% and -0.1% growth. [19659002] "The truth of the matter is that Germany in there is no stable growth prospect right now, "she said, noting that the country had turned

The whole question is what will be the sources of future growth for Germany and the challenge to change the German economy structurally is huge … There must be a strong investment in education, research and innovation and Germany also needs investment in infrastructure. "

Ifo decrease

Last month, Germany's leading institute for economic research drastically lowered its projections for the largest economy in Europe. The Ifo Institute's total economic forecast for 2019, published in early October, was revised down from 0.8% of GDP forecast in the spring, to just 0.5%.

The causes of the poor performance, according to the institute, include the declining global demand for capital goods, which has affected the German export economy, along with political uncertainty and structural changes in the automotive industry.

Elliott Smith and Chloe Taylor of CNBC contributed to this report.


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