news

as the "locomotive" of the european economy, germany's current economy is not only flashing red lights, but is also more likely to fall into a recession crisis. a series of recently released economic data show that germany's current economic situation is not good. data show that the final value of germany's manufacturing pmi in august was 42.4, a further decline from the final value of 43.2 in july, and has always been in the contraction range. compared with the manufacturing industry, the german service industry performed relatively well. the final value of the german service industry pmi in august was 51.2, which was above the 50 boom-bust line, but lower than the final value of 52.5 in july.

in addition, the german ifo business climate index in september was 85.4, continuing to decline, lower than the previous value of 86.6. data released by germany's zew economic research institute showed that germany's zew economic prosperity index dropped sharply to 3.6 in september from 19.2 in august. the decline was far greater than expected, and the assessment of germany's economic situation also continued to deteriorate.

the german ifo economic research institute pointed out in its autumn economic forecast report released in september that the german economy will still be in crisis due to the impact of cyclical factors and structural factors. germany's inflation-adjusted gross domestic product is expected to stagnate this year after the economy shrank 0.3% last year, the ifo institute of economics said in a statement. compared with the summer economic forecast, the ifo economic research institute lowered germany's growth forecast for this year by 0.4 percentage points, and german economic growth will stagnate. in addition, the german economic growth forecast for 2025 has also been lowered by 0.6 percentage points.

according to the latest monthly report released by the bundesbank in september, the german economy is expected to remain weak. judging from the current situation, germany's real gross domestic product (gdp) may stagnate or even decline again in the third quarter of 2024. however, economists at the bundesbank do not expect a significant, widespread and sustained decline in economic output in germany.

specifically, weak domestic demand in germany weighed on industrial production. german industrial sector and construction output underperformed in the third quarter. the monthly report noted that growing economic policy uncertainty is putting pressure on businesses. in addition, higher financing costs dampened demand for industrial products and construction projects. in addition, although demand for german industrial products has increased, this is not enough to offset the overall lack of orders for industry.

on the labor market, monthly reports show that the lack of economic stimulus measures is gradually having an impact on germany's labor market development and prospects. although employment levels in germany are high, job growth has slowed recently. total employment rose by just 4,000 on a seasonally adjusted basis in july, and the unemployment rate remained at 6.0% in august. overall, however, the current labor market outlook in germany remains relatively stable.

currently, the european central bank has begun to cut interest rates, and the overall inflation level in the eurozone is declining. specifically to germany, germany 8moontuneandthe consumer price index (hicp) rose 2% year-on-year, compared with 7monththere was an obvious sharp decrease of 2.6%.however, the bundesbank said in its monthly report that it expected inflation in germany to rise again in the coming months.german inflation in september is likely to remain at a similar low level as in august, butexpectedit will then slowly rise again.