Categories: Market Overview

German economy contracted by a record 9.7% in the second quarter

The German economy contracted by a record 9.7% in the second quarter as consumer spending, company investments and exports all collapsed at the height of the COVID-19 pandemic, the statistics office said on Tuesday.

The economic slump was much stronger than during the financial crisis more than a decade ago, and it represented the sharpest decline since Germany began to record quarterly GDP calculations in 1970, the office said.

Still, the reading marked a minor upward revision from an earlier GDP estimate for the April-June period of -10.1% quarter-on-quarter that the office had published last month.

Consumer spending shrank by 10.9% on the quarter, capital investments by 19.6% and exports by 20.3%, the seasonally adjusted GDP data showed.

Construction activity, normally a consistent growth driver for the German economy, fell by 4.2% on the quarter.

The only light came from state consumption which rose by 1.5% on the quarter due to the government’s coronavirus rescue programmes, the office said.

German economy shrank by record 9.7% in second quarter, CNBC, Aug 25

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