Bundesbank says German economy may have contracted again in Q3

Xinhua News Agency | Oct 21, 2019 at 12:57 PM

FRANKFURT, Oct. 21 (Xinhua) -- Germany's economic output could have fallen slightly again in the third quarter of 2019, mainly due to the continued weakening of the country's export-oriented industry, Deutsche Bundesbank, the German central bank, said in a monthly report released on Monday.

After a 0.4-percent growth in the first quarter, the overall economic output of the eurozone's largest economy weakened by 0.1 percent in the second quarter.

The Bundesbank said the leading indicators currently show few signs of a sustained recovery in exports and stabilization in the industrial sector. There is a greater risk that the downward trend would extend to the more domestically-oriented industries, the analysts wrote.

However, the central bank also said that a clear, broad-based recession is not yet apparent. Retail sales figures indicated that consumer confidence was undiminished and the labor market continued to improve, resulting in favorable income prospects for consumers, it said.

The report showed that in July and August, the average industrial production was markedly lower than in the second quarter. The production of intermediate goods and consumer goods fell sharply.

In July and August, on average, production in the construction industry also fell slightly compared to the second quarter. However, new orders in the construction industry in July rose noticeably, the bank said.