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Macroeconomic outlook report: Germany

Fourth quarter of 2018

During the fourth quarter of 2018, Germany's GDP slowed by 0.53 p.p. in its year-over-year growth rate, to 0.64%. This was due to the performance of both external and domestic demand. In the labor market, the unemployment rate fell by 0.16 p.p. to 3.17%, while the year-over-year growth rate of employment slowed by 0.02 p.p. to 1.14%. Inflation was 2.15%, up 0.05 p.p. from 3Q18. Finally, the euro depreciated against the US dollar by 0.02 dollars per euro compared to the previous quarter, to an average exchange rate of 1.14 $/€ in the last quarter of the year.

Macroeconomic overview

  • During the last quarter of the year, the German economy recorded a slowdown in its year-over-year GDP growth rate of 0.53 p.p. with respect to the previous quarter, to 0.64%. This behavior was due to the performance of external demand, after a deceleration in exports, as well as the deceleration of domestic demand.
  • Domestic demand decelerated by 0.33 p.p. when compared to the previous quarter, to a year-over-year growth rate of 1.92%.
  • In the labor market, the unemployment rate fell by 0.16 p.p. to 3.17% and the year-over-year growth rate of employment slowed by 0.02 p.p. compared to the third quarter of 2018, to 1.14%.
  • The euro depreciated against the US dollar by 0.02 dollars per euro from the third quarter of 2018, recording an average exchange rate of 1.14 $/€ in 4Q18.
  • Inflation stood at 2.15% in the last quarter of 2018, following an acceleration of 0.05 p.p. from the previous quarter. This was mainly due to increases in energy and transport prices.

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© GMS Management Solutions, S.L., 2019. All rights reserved. The information contained on this publication is of a general nature and does not constitute a professional opinion or an advisory service. The data used in this publication come from public sources. GMS Management Solutions, SL assumes no liability for the veracity or accuracy of such data.