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- German GDP declined 0.2% in Q3
German GDP declined 0.2% in Q3
German economic growth has stalled. As the Federal Statistical Office (Destatis) already reported in its first release of 14 November 2018, the gross domestic product (GDP) in the third quarter of 2018 was by 0.2% lower - upon price, seasonal and calendar adjustment - than in the second quarter of 2018. This was the first quarter-on-quarter decrease since the first quarter of 2015. In the first half of 2018, the GDP had increased, by 0.5% in the second quarter and by 0.4% in the first quarter.
The slight quarter-on-quarter decline in the gross domestic product was mainly due to the development of foreign trade in the third quarter of 2018. According to provisional calculations, exports of goods and services fell by 0.9% on the second quarter of 2018. At the same time, imports were up 1.3%.
As regards domestic demand, there were mixed signals. Gross fixed capital formation in machinery and equipment rose by 0.8%, and in construction even by 0.9%, on the previous quarter. Household final consumption expenditure was down 0.3%, one reason being private households' reluctance to buy new cars. Together with higher imports, this led to an above-average increase in inventories. Government final consumption expenditure was slightly higher than in the previous quarter (+0.2%).
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