1. Home
  2. Studies
  3. IW Economic Forecast and Business Survey Autumn 2018: Weak Growth with a Stiffening Headwind
IW Research Group Macroeconomic Analysis and Forecast IW-Trends 3. December 2018 IW Economic Forecast and Business Survey Autumn 2018: Weak Growth with a Stiffening Headwind

The German economy contracted in the third quarter of 2018 as temporary dips in new registrations caused a decline in production in the automotive sector. Although some of this lost ground will be made up later, economic growth for the year as a whole will be a meagre 1.5 per cent.

Download PDF
Weak Growth with a Stiffening Headwind
IW Research Group Macroeconomic Analysis and Forecast IW-Trends 3. December 2018

IW Economic Forecast and Business Survey Autumn 2018: Weak Growth with a Stiffening Headwind

IW-Trends

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

The German economy contracted in the third quarter of 2018 as temporary dips in new registrations caused a decline in production in the automotive sector. Although some of this lost ground will be made up later, economic growth for the year as a whole will be a meagre 1.5 per cent.

A further factor in this deceleration is the slowing momentum of the global economy. American protectionism, the slowdown in emerging markets and uncertainties stemming from an imminent Brexit and the new Italian government are weighing on corporate expectations. The regular survey of German business conducted by the German Economic Institute (IW) comes to similar conclusions. The prospects for production, export, investment and employment in Germany have all deteriorated noticeably in the course of 2018. While by no means stagnating, at a mere 1.2 per cent the German economy is expected to enjoy only very modest growth in 2019. These dampened expectations are reflected in the labour market. Employment will continue to rise and unemployment to fall, but the movements will become more leisurely. Despite these signs of an economic slowdown, the public budget will remain in surplus next year, but at only half its current rate. While tax revenues are growing more slowly on the revenue side, government spending, especially social expenditure, will continue its steep rise.

Download PDF
Weak Growth with a Stiffening Headwind
IW Research Group Macroeconomic Analysis and Forecast IW-Trends 3. December 2018

IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur: Schwaches Wachstum bei auffrischendem Gegenwind – Prognose und IW-Konjunkturumfrage Herbst 2018

IW-Trends

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

Download PDF
IW Research Group Macroeconomic Analysis and Forecast IW-Trends 3. December 2018

IW-Forschungsgruppe Gesamtwirtschaftliche Analysen und Konjunktur: Schwaches Wachstum bei auffrischendem Gegenwind – Prognose und IW-Konjunkturumfrage Herbst 2018

IW-Trends Materialien

Download PDF

More on the topic

Read the article
Effects of Public Investment on Companies in Germany – Results of the IW Business Survey
Hubertus Bardt / Michael Grömling IW-Trends No. 2 16. June 2023

Effects of Public Investment on Companies in Germany – Results of the IW Business Survey

Weak public investment activity in Germany has contributed to the low productivity growth of the last decades. Even maintaining the contribution to growth of state-owned capital stock at the already low level of the 1990s would have required an additional ...

IW

Read the article
Hubertus Bardt / Michael Grömling in Advances in Resilient and Sustainable Transport External Publication 30. March 2023

Supply Chains, Cost and Investments in Times of Multiple Crises

The Russian invasion of Ukraine has significantly clouded the economic outlook in Germany and worsened the investment climate. The investment gap created in the wake of the Covid pandemic will not be closed for the time being.

IW

Content element with id 8880 Content element with id 9713