Germany plans to avoid recession: sources

Germany is expected to narrowly escape a recession and post modest growth in the first quarter of the year, according to forecasts from leading economic institutes seen by Reuters on Tuesday.

The so-called Joint Economic Forecasts, which will be presented on Wednesday in Berlin, forecast gross domestic product growth of 0.1% in the first quarter. This follows a 0.4% contraction in the fourth quarter of 2022.

A recession is commonly defined by two successive quarters of contraction.

The five economic institutes producing the joint economic forecasts forecast German GDP growth of 0.3% for 2023, against an expected contraction of 0.4% in the autumn (in the northern hemisphere), two told Reuters. sources close to the data.

For 2024, the institutes – four German and one Austrian – forecast GDP growth of 1.5%, lower than the previous 1.9%.

In its annual economic report released in January, the German government expects growth of 0.2% for 2023. The economy ministry will update its forecasts by incorporating the results of the joint economic forecasts in the spring (in the northern hemisphere).

Economic institutes forecast inflation of 6.0% in 2023, before slowing to 2.4% in 2024.

The joint economic forecasts are prepared by the Ifo Institute, the Halle Institute for Economic Research, the Kiel Institute for World Economy, the RWI – Leibniz Institute for Economic Research and the Austrian Institute for Economic Research.

Source: Terra

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