Daily Memo: Dismal German Economy Stats

The German economy saw a record contraction in the second quarter of 2020.

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Dismal German economy stats. German statistics agency Destatis released preliminary data for the second quarter on Thursday, and though final figures won’t be published until Aug. 25, it’s already clear that the first half of 2020 was one of the most challenging times in history for the German economy. German gross domestic product contracted in the second quarter by 11.7 percent year over year and 10.1 percent quarter over quarter, the largest decline on record, according to Destatis. By comparison, German GDP declined by 4.7 percent in the first quarter of 2009, following the global financial crisis that year. Government spending also increased in the second quarter, but it was not enough to lift the economy out of the slump, even after quarantine measures were eased. Although German businesses are beginning to return to full-time employment, results vary by sector; workers in more than 80 percent of basic metals manufacturing companies are still working fewer hours than normal. German automaker Volkswagen cut dividends after announcing an 800 million-euro ($943 million) loss in the first half of the year because showrooms and factories in key markets were closed due to the COVID-19 pandemic. However, VW expects sales to recover in the […]

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