The volume of industrial production in Germany at the end of July decreased by 2.4% compared to the previous month, which only increased experts’ fears of a possible recession in the German economy, the ARD television channel reported on the basis of data from the German Federal Statistical Office.
Compared to July last year, industrial production also decreased by 5.3%. Thus, the indicators reached their lowest levels since the pandemic and negative dynamics were observed in ten of the last 14 quarters.
According to the published data, the further decline is due in particular to the unfavourable development of the automotive industry. Production volume in one of the key sectors of the German economy fell by 8.1% in July.
“The weak sales figures indicated that German industry would not gain momentum in July either. On the contrary, the downward trend continued. These figures fuel the debate about the deindustrialisation of Germany.” — Sirus de la Rubia, chief economist at the Commercial Bank of Hamburg, commented on the situation.
A bright spot for the German economy in July was the growth in export volumes. According to the Federal Statistical Office, goods worth 130 billion euros were delivered to foreign markets, 1.7 percent more than in the first month of summer.
“However, the overall picture remains bleak: at the end of seven months of this year, export volumes were down 1.1% compared to the same period in 2023. Imports were down 5.1%.” – noted in the publication.
According to an expert from the Institute of Economic Research Klaus WohlrabeGerman exporters are currently unable to benefit from the economic growth of other European countries.
“They are not yet able to stimulate the positive dynamics of the German economy,” – he emphasized.
Pessimistic expectations are also reflected in the revised economic forecasts for 2024. In particular, the Munich and Halle Institutes for Economic Research expect the German economy to stagnate. The Kiel Institute for World Economics, for its part, forecasts a GDP decline of 0.1% by the end of the year.
Experts have also revised their expectations downwards. Instead of a slight GDP growth of 0.4%, analysts now expect stagnation of 0%, the TV channel notes.
“The hopes for industrial recovery that we had at the beginning of the year have not materialized” – declared Geraldine Dani-Knedlik from the German Institute for Economic Research in Berlin.
