During the fourth quarter of 2021, Germany's GDP recorded a decrease in its year-on-year change compared to the previous quarter, thus registering a year-on-year rate of 1.77%. This drop was due to a decline in domestic demand, in particular a decline in gross fixed capital formation. On the labour market, the unemployment rate decreased from the previous quarter to 3.23%, while the year-on-year change in employment increased to a rate of 0.45%. Inflation stood at 5.03%, having accelerated from the previous quarter. Finally, the euro depreciated against the US dollar, with an average exchange rate of 1.14 $/€ during the fourth quarter of the year.


Macroeconomic outlook report: Germany 4Q21

Watch video

Macroeconomic overview

  • During the fourth quarter of the year, the German economy recorded a decrease in its y/y GDP variation rate of 1.11 p.p. compared to the previous quarter, down to a rate of 1.77%. The German economy suffered from supply chain bottlenecks and was affected by the resurgence of the pandemic.
  • Domestic demand registered a decline of 0.65 p.p. from the previous quarter to a rate of 2.96%. This was mainly due to a fall in year-on-year growth in gross fixed capital formation. Regarding external demand, exports recorded an increase of 0.20 p.p. from the previous quarter, registering a positive growth rate of 7.93%. Year-on-year growth in imports also increased, with a variation of 2.54 p.p. to 12.00%.
  • With regards to the labour market, the unemployment rate declined from the previous quarter to a rate of 3.23%, while the year-on-year change in employment increased by 0.06 p.p. from the previous quarter to 0.45%.
  • The euro depreciated against the US dollar compared to the third quarter of 2021, recording an average exchange rate of 1.14 $/€ in 4Q21.
  • Inflation stood at 5.03 % during the fourth quarter of 2021, after recording an increase of 1.13 p.p. compared to the previous quarter.

For more information, click here to access the executive document in pdf.