Europe's largest economy is facing a possible third consecutive year of recession
Share:
Forget this week's minor decrease in the UK inflation number. The most important European data release was the confirmation from Germany that, during 2024, its economy contracted for the second consecutive year. Europe's largest economy shrank by 0.2% during 2024 - on top of a 0.3% contraction in 2023.
Now it must be stressed that this was a very early estimate from Germany's Federal Statistics Office and that the numbers may be revised higher in due course. That health warning is especially appropriate this time around because, very unexpectedly, the figures suggest the economy contracted during the final three months of the year and most economists had expected a modest expansion.
Money latest: Guinness rival's sales surge 632%. If unrevised, though, it would confirm that Germany is suffering its worst bout of economic stagnation since the Second World War. The timing is lousy for Olaf Scholz, Germany's chancellor, who faces the electorate just six weeks from now.
UK bans import of German cattle, pigs and sheep to prevent foot and mouth disease spreading. As the AfD elects its chancellor candidate, the far-right party looms large over German politics. Elon Musk's AfD broadcast cleared up any doubts over his attitude to Germany's far right.
Worse still, things seem unlikely to get better this year, regardless of who wins the election. Please use Chrome browser for a more accessible video player. Germany, along with the rest of the world, is watching anxiously to see what tariffs Donald Trump will slap on imports when he returns to the White House next week.
