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ECONOMIC GROWTH - BERLIN. The German economy stagnated in the second quarter of 2023, with no quarter-on-quarter change in gross domestic product in seasonally adjusted terms, the federal statistics office reported on Friday, missing estimates for slight growth.
A Reuters poll of analysts had forecast an increase of 0.1%, after the economy fell into a mild recession in winter.
The statistics office also revised the figures for the previous quarters to a 0.1% GDP decline in the first quarter from a prior estimate of a 0.3% drop and a 0.4% contraction in the last quarter of 2022, revised from a decline of 0.5%.
Household consumption stabilised in the second quarter after the weak winter half-year, according to the statistics office.
Year-on-year, the economy contracted by a price and calendar adjusted 0.2%.
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"We continue to see the German economy being stuck in the twilight zone between stagnation and recession," said Carsten Brzeski, global head of macro at ING.
Weak purchasing power, thinned-out industrial order books, the impact of the most aggressive monetary policy tightening in decades, and the expected slowdown of the U.S. economy, all argue in favour of weak economic activity, Brzeski said.
"The German economy will remain stuck in the mud for the foreseeable future," said Claus Vistesen, chief eurozone economist at Pantheon Macroeconomics.
