• Sun. Apr 14th, 2024

Germany’s Industrial Slowdown Squeezes the Eurozone: Will Recession Follow?

BySamantha Johnson

Mar 7, 2024
German Factory Orders Decline, Pointing to Economic Slowdown

In the beginning of 2024, German factory orders experienced a sharp decline following a slight uptick in December. This highlights the challenges faced by Europe’s largest economy as it struggles to overcome its recent slowdown. According to data released Thursday, there was an 11.3% decrease in demand in January compared to the previous month, which was worse than expected by economists in a Bloomberg survey. The drop was attributed to a slowdown in major orders, which had shown strong performance in December but returned to normal levels in January.

Despite this setback, Germany recently reported strong export numbers at the beginning of 2024, suggesting that the industrial weakness in the country may be starting to ease. However, the prolonged downturn in Germany’s manufacturing sector is weighing on the overall economy and raising concerns that the country may be entering a recession.

The Bundesbank has warned that output could shrink in the January-March period after a 0.3% decline in the final quarter of 2023. While it does not believe a severe downturn is likely, economists like Ralph Solveen from Commerzbank predict that industrial production will continue to fall in the coming months and could contribute to a contraction in Germany’s economy during this period.

Germany was the only Group of Seven country to see its GDP decline in 2023 due to weak global demand, high inflation, energy supply issues and court-mandated budgetary constraints. This economic weakness is also affecting Germany’s broader euro zone, which has been on the brink of a recession for over a year. Germany recently lowered its growth forecast for 2024 to just 0.2%, significantly downgrading from earlier predictions of 1.3%. Bloomberg Economics shares this pessimistic outlook and reduced its projection for German expansion growth to only 0.2% for 2024 due to weak global demand being expected to continue impacting

By Samantha Johnson

As a content writer at newszkz.com, I delve into the realms of storytelling, blending words to paint vivid narratives that captivate and inform our readers. With a keen eye for detail and a passion for research, I craft compelling articles that resonate with our audience. My love for words drives me to explore diverse topics, ensuring that each piece I create not only educates but also entertains. Join me on this journey as we navigate the ever-evolving landscapes of news and knowledge together.

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