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IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur IW-Trends No. 2 23. April 2019 Uncertainty Weakens the Economy: IW Economic Forecast and IW Economic Survey Spring 2019

Since the summer of 2018 the German economy has only been treading water. The reasons for this are the slowdown in world trade caused by protectionism and the adjustment burdens in the automotive sector, which have affected the production and export activity of German manufacturing.

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IW Economic Forecast and IW Economic Survey Spring 2019
IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur IW-Trends No. 2 23. April 2019

Uncertainty Weakens the Economy: IW Economic Forecast and IW Economic Survey Spring 2019

IW-Trends

German Economic Institute (IW) German Economic Institute (IW)

Since the summer of 2018 the German economy has only been treading water. The reasons for this are the slowdown in world trade caused by protectionism and the adjustment burdens in the automotive sector, which have affected the production and export activity of German manufacturing.

The economy is expected to regain its footing in the first half of 2019, but will proceed at a very subdued pace. With weakened growth in world trade and global investment activity suffering from geopolitical uncertainties, German export expectations remain moderate. They are sufficient to keep corporate investment on its upward trend – but at a snail’s pace. The German economy will continue to be stimulated by investments in construction and by a number of consumer-related service industries. Though expanding employment will still drive consumer spending, the employment outlook for German companies has cooled. The average number of people in employment will rise to 45.5 million by 2020, when the number of jobless will be just over 2 million, corresponding to an unemployment rate of 4.5 per cent. Real GDP will grow by slightly less than 0.7 per cent in 2019 and by just over 1.5 per cent next year, reflecting a considerably higher number of working days. Inflation in the forecast period is expected to exceed 1.5 per cent by a small margin. Despite a significant increase in government spending, public finances will be in surplus.

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IW Economic Forecast and IW Economic Survey Spring 2019
IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur IW-Trends No. 2 23. April 2019

IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur: Verunsicherung schwächt die Konjunktur – IW-Konjunkturprognose und Konjunkturumfrage Frühjahr 2019

IW-Trends

German Economic Institute (IW) German Economic Institute (IW)

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Jürgen Matthes / Michael Grömling / Markus Demary / Björn Kauder / Berthold Busch / Gero Kunath / Thomas Obst External Publication 25. October 2023

Why Price Stability Matters

As of March 2023, overall infation is declining in Europe. However, core infation levels continue to remain well above the 2% mandate of the European Central Bank (ECB). In fact, the current bout of infation should continue to weaken as and when supply-chain ...

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Michael Grömling / Michelle Koenen / Gero Kunath / Thomas Obst / Sandra Parthie in Intereconomics External Publication 17. October 2023

Deindustrialisation – A European Assessment

The war in Ukraine has exacerbated pre-existing production problems in manufacturing networks originating from the coronavirus pandemic. Material shortages are compounded by uncertainties about sufficient energy supplies.

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