Germany’s Federal Statistics Office said today, Friday, that the German economy likely contracted in the fourth quarter of last year, but it grew by 1.9% during the whole of 2022, indicating that Europe’s largest economy may escape recession during winter season.
Growth came gross domestic product By 1.9% in the whole of 2022, compared to expectations for growth of 1.8% in a Reuters poll of economists.
A preliminary reading for the fourth quarter suggests that Germany may avoid a recession, which is defined as two consecutive quarters of contraction.
There were growing indications that the economy, which grew in the third quarter, could avoid the worst effects of the downturn caused by the drop in Russian energy supplies after the invasion of Ukraine.
A survey last month showed that business confidence rose more-than-expected in December, as economic prospects improved despite the energy crisis and rising inflation.
Earlier this week, the government’s economic advisor, Monika Schnitzer, told Reuters that inflation in Germany had likely peaked with global energy prices falling, adding that she expected natural gas prices to continue falling this year.
Inflation in Germany fell for the second month in a row in December, due to lower energy prices and the government paying one-time household energy bills, with EU-harmonized consumer prices rising 9.6% over the year.
