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- Germany's GDP fell by 2.3% year on year in the first quarter
Germany's GDP fell by 2.3% year on year in the first quarter
According to the report from Federal Statistical Office (Destatis), the corona pandemic hits the German economy hard. Although the spread of the coronavirus did not have a major effect on the economic performance in January and February, the impact of the pandemic is serious for the 1st quarter of 2020. The gross domestic product (GDP) was down by 2.2% on the 4th quarter of 2019 upon price, seasonal and calendar adjustment. That was the largest decrease since the global financial and economic crisis of 2008/2009 and the second largest decrease since German unification. A larger quarter-on-quarter decline was recorded only for the 1st quarter of 2009 (-4.7%).
Household final consumption expenditure fell sharply in the 1st quarter of 2020. Gross fixed capital formation in machinery and equipment decreased considerably, too. However, final consumption expenditure of general government and gross fixed capital formation in construction had a stabilising effect and prevented a larger GDP decrease. Both exports and imports saw a strong decline on the 4th quarter of 2019.
Economic performance slumped heavily also in a year-on-year comparison. The GDP in the 1st quarter of 2020 was down a price-adjusted 1.9%, and a calendar-adjusted 2.3%, on a year earlier. Only in the years of the financial and economic crisis of 2008/2009 had there been larger decreases on the relevant quarter of the preceding year. The largest decrease (-7.9%) had been recorded for the 2nd quarter of 2009 (in calendar-adjusted terms for the 1st quarter of 2009 (-6.9%)).
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