Germany faces temporary economic slowdown: Bundesbank |
| AFP - Dec 7, 2012 |
The German economy, Europe's biggest, will not be able to escape the crisis and may even flirt briefly with recession early next year, but is well placed to rebound strongly, the Bundesbank said Friday.
The German central bank, in its latest updated twice-yearly forecasts, said there were "indications that economic activity may actually fall in the final quarter of 2012 and the first quarter of 2013."
Recession is technically defined as two consecutive quarters of negative growth and many of Germany's eurozone neighbours have been pushed into recession, in some cases deep, by the region's long-running debt crisis.
Although Germany has managed to hold up to the crisis fairly well, growth has slowed here as well since the beginning of the year.
After expanding by 0.5 percent in the first quarter of 2012, gross domestic product (GDP) grew by just 0.3 percent in the second quarter and a mere 0.2 percent in the third quarter.
"The cyclical outlook for the German economy has dimmed," the Bundesbank wrote in its December monthly report.
"However, there are sound reasons to believe that Germany will soon return to a growth path. The sound underlying health of the German economy suggests that it will overcome the temporary lull without major damage to the labour market, in particular," it said.
Read Full Article from AFP
- Posted: 2012-12-07 12:21:32
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