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Germany narrowly avoided the recession in the fourth quarter, reporting only zero growth, foreign trade being of little importance to Europe's largest economy.
The mediocre figure released Thursday by the official statistics agency follows a decline of 0.2% of production in the third quarter before. Business spending on machinery and equipment, as well as construction, supported the economy in the fourth quarter and prevented Germany from experiencing two consecutive quarters of negative growth, a definition of the recession.
Slowing world trade and trade tensions between the United States and China are holding back the German export-oriented economy. Last year's growth was also affected by problems in the automotive industry, as automakers struggled to get new cars certified under new emissions tests, and by lack of water on the market. Rhine interrupting the trade. The slowdown led the European Commission last week to reduce its growth forecast for Germany for this year from 1.3% to 1.3%.
The weakness of the second half was due to a better performance in the first half, leaving 1.5% growth for the year as a whole.
Andrew Kenningham, chief economist for Europe at Capital Economics, said the weakness of the fourth quarter "bodes ill for economic growth this year as well," he said. the last three months of the year. He predicted growth of 1.0% this year, but added "this forecast presents significant downside risks".
Carsten Brzeski, economist at ING Germany, said: "The German economy has escaped a technical recession with as small a margin as possible. The black eye has become increasingly black. He added, however, that many economic fundamentals remained strong. A low unemployment rate of 3.3% helps support domestic demand.
"The advantage of the current data is that it can hardly get worse," Brzeski said. "The economic fundamentals remain solid and from now on, the chances of a gradual rebound are still much higher than the odds of a further disappointment."
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