15.05.202008:40:00UTC+00German Economy Contracts Most Since Global Financial Crisis

The German economy contracted at the fastest pace since the global financial crisis in the first quarter as coronavirus pandemic dampened consumption and overseas demand, preliminary data from Destatis revealed Friday.

Gross domestic product fell 2.2 percent sequentially, after falling 0.1 percent in the fourth quarter. The rate came in line with expectations.

This was the largest decrease since the global financial and economic crisis of 2008/2009 and the second largest decrease since German unification.

On a yearly basis, GDP declined by calendar-adjusted 2.3 percent in the first quarter versus a 0.4 percent rise in the fourth quarter.

Price-adjusted GDP dropped 1.9 percent in contrast to an expansion of 0.2 percent seen in the fourth quarter. Economists had forecast a 1.6 percent fall.

Household final consumption expenditure fell sharply and gross fixed capital formation in machinery and equipment decreased considerably.

However, final consumption expenditure of general government and gross fixed capital formation in construction had a stabilizing effect and prevented a larger GDP decrease.

Meanwhile, both exports and imports logged a strong decline on the fourth quarter.