(Reuters) – The German economy fell more than expected in the fourth quarter, reviving the fears of recession, while the first European economy faces uncertainty as the federal election of February.
According to a first official estimate published Thursday by the Office Dee La Statistics, the gross domestic product (GDP) of Germany fell 0.2%, against a drop of 0.1% expected by the economists interviewed by Reuters, And after an increase of 0.1% in the third quarter.
If growth in the first quarter of 2025 is also negative, the German economy will fall back into recession, technically defined as two consecutive quarters of contraction.
The intensification of foreign competition, high energy costs, high interest rates and uncertain economic prospects weighed on the German economy, which contracted in 2024 for the second consecutive year.
In its annual economic report, the German government reduced its growth forecast for 2025 to 0.3%, against 1.1% previously expected, due to trade tensions and increasing uncertainty concerning the coming elections.
Certain professional associations also provide for a new contraction of activity in 2025, which would place Germany on the path of three years of decline for the first time since reunification in 1990.
The dispute on how to revive the economy contributed to the collapse of the coalition of Chancellor Olaf Scholz in November, paving the way for early elections on February 23.
(Report Maria Martinez and Miranda Murray, Diana Mandiá, edited by Blandine Hénault and Augustin Turpin)
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