Germans caught in ‘winter recession’ as forecasters predict gradual development
The Ifo institute now expects German output to rise by simply 0.2% in 2024 having beforehand pencilled in 0.7%
Germany is caught in a ‘winter recession’ and development in 2024 might be weaker than feared, say two of its main forecasters.
The Ifo institute now expects output to rise by simply 0.2 per cent having beforehand pencilled in 0.7 per cent, whereas the IfW Kiel institute slashed its forecast from 0.9 per cent to 0.1 per cent.
‘The economy is paralysed,’ mentioned Ifo head of forecasts Timo Wollmershaeuser.
He added: ‘If you look at surveys of companies and households, you realise that the mood is poor and uncertainty is high.
Consumer restraint, high interest rates and price increases, the government’s austerity measures and the weak international financial system are at present dampening the financial system in Germany and main to a different winter recession.’
The German financial system shrank by 0.3 per cent within the last three months of 2023 and it’s anticipated to contract once more within the first quarter, in line with Wollmershaeuser.
Two consecutive quarters of falling output are outlined as a technical recession.
