Germany tumbles into recession as economic system hit tougher by Brexit than Britain – Specific.co.uk


The Bundesbank said the German economy contracted again in the third quarter of the year. That followed a decline in output of 0.1 per cent in the second quarter, leaving the single currency bloc’s largest economy in recession. The country’s central bank said in its monthly report: “Germany’s economic output could have shrunk again slightly in the third quarter of 2019.

“The decisive factor here is the continued downturn in the export-oriented industry.”

The Bundesbank added this downturn was also casting a shadow on the rest of economy.

It said: “Early indicators currently provide few signs of a sustainable recovery in exports and a stabilisation of the industry.”

An economic recession is triggered when GDP falls during two consecutive quarters, or six months.

Germany’s continued slump comes after Germany’s GDP fell by 0.1 percent in the three months from April to June.

Germany has been affected by weakness across much of Europe.

This includes the UK.

The British economy also contracted in the second quarter, by 0.2 per cent.

READ MORE: Germany recession panic: Merkel alarm as Central Bank warns of slump

The IMF has cut its global growth forecast for this year to three percent.

This is down from 3.6 percent last year and is the weakest since the financial crisis a decade ago.

Meanwhile, Britain is expected to grow faster than Germany, France and Italy in 2019 and 2020.

Former IMF head Christine Lagarde, who is taking over as head of the European Central Bank, said Brexit would cause damage across Europe.

She said: “Everybody will be a little less well-off as result.”

ECB President Mario Draghi cited a “weakness” in the Eurozone economy for the change in fiscal policy.

Mr Draghi said: “Incoming information since the last Governing Council meeting indicates a more protracted weakness of the euro area economy, the persistence of prominent downside risks, and muted inflationary pressures.”

Economic figures for the third financial quarter will be published on November 14.



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