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Friday, 29 March 2024

As euro zone growth plunges, Germany looks least awful

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As euro zone growth plunges, Germany looks least awful
As euro zone growth plunges, Germany looks least awful

Germany seems to be weathering the economic storm better than most of the euro zone, but GDP figures everywhere in the region make grim reading.

Julian Satterthwaite reports.

Germany looks to be weathering the economic storm better than most of Europe.

First quarter figures out Friday show its economy shrinking 2.2% on the previous three months.

That’s the biggest drop since the global financial crisis a decade ago.

But it’s less awful than the rest of the euro zone.

Overall, GDP in the region tumbled 3.8% on the quarter.

That’s the sharpest drop since records begin in 1995.

Worst hit was France, with a 5.8% contraction.

Spain and Italy did only sightly better.

Only Finland managed to eke out fractional growth.

The impact of lockdowns shows up in trade data.

Exports tumbled, and imports dropped even more - down over ten percent on the year.

But the first-quarter figures cover only a part of the lockdown period.

That means the next set of numbers are certain to be worse.

The region is now expected to face its worst recession on record.

Even as lockdowns ease, there are doubts over how much relief that will bring.

Countries like Germany that have lifted some restrictions have already reported a rise in new virus cases.

If that heralds a second wave of infections, the economic pain could be just beginning.

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