German economy off to a good start in 2019

The German economy started 2019 with robust growth of 0.4 percent. It has thus managed to leave behind the weak phase of the second half of 2018. This was possible despite the fact that industry is currently forfeiting its role as economic locomotive in the face of negative pressure from the international arena. With the labour market in Germany in good shape and incomes rising, private households were able to spend more money on private consumption and invest heavily in real estate. Together with higher corporate investments, this has managed to keep the domestic economy stable in the first quarter.

The shift from export-driven growth to a stronger domestic orientation is normal and also desirable in the late phase of the cycle. It enables more stable growth, albeit at a slightly lower level.

However, this does not mean that the German economy is immune to a global economic slump due to a further escalation of the trade dispute. This will undoubtedly be the biggest risk for the second half of the year. If no agreement can be reached between the USA and China in the next few weeks and Trump also imposes car tariffs on Europe, the economic upswing in Germany could be endangered.


Rate this article

Thank you for your rating. Your vote:
There is no rating yet. Be the first! Current average rating: 0

Leave an answer

Your e-mail address will not be published. Required fields are marked *