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Macroeconomic outlook report: Germany

First quarter of 2018

During the first quarter of 2018, the German economy recorded a deceleration of 0.62 p.p. in its year-over-year growth rate in comparison with the previous quarter, standing at 2.29%. The year-over-year growth rate of domestic demand increased to 1.98%. Regarding the labor market, the unemployment rate went up to 3.63% and the year-over-year growth rate of employment decreased when compared to the fourth quarter down to 1.38%. The euro appreciated against the dollar, registering an exchange rate of 1.23 $/€. Finally, the inflation stood at 1.50%.

Macroeconomic overview

  • During the first quarter of the year, the German economy registered deceleration in the year-over-year growth rate of GDP of 0.62 p.p. when compared to the previous quarter, up to a rate of 2.29%. This performance was mainly driven by a reduction of external demand due to a larger decline in exports than imports.
  • Furthermore, the year-over-year growth rate of the domestic demand experienced an increase of 0.01 p.p. with respect to the fourth quarter of 2017, registering a growth rate of 1.98% offset by the deceleration of public and private consumption.
  • As for the labor market, the unemployment rate went up to 3.63% and the year-over-year growth rate of employment decreased to 1.38% when compared to the fourth quarter of 2017.
  • The euro appreciated against the US dollar by 0.05 dollars per euro compared to the previous quarter, registering an exchange rate of 1.23 $/€. This appreciation was due to the European economic situation, based on sustained growth, low inflation and the behavior of the foreign sector.
  • The inflation stood at 1.50% in the first quarter of 2018, which is 0.16 p.p. below the rate registered in the previous quarter.

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© GMS Management Solutions, S.L., 2018. 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.