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Macroeconomic outlook report: Germany

Fourth quarter of 2017

During the fourth quarter of 2017, the German economy recorded an acceleration of 0.20 p.p. in its year-over-year growth rate in comparison with the previous quarter, standing at 2.91%. The year-over-year growth rate of domestic demand dropped to 1.99%. Regarding the labor market, the unemployment rate went down to 3.57% and the year-over-year growth rate of employment increased when compared to the third quarter up to 1.47%. The euro appreciated against the dollar, registering an exchange rate of 1.18 $/€. Finally, the inflation stood at 1.66%.

Macroeconomic overview

  • During the fourth quarter of the year, the German economy registered acceleration in the year-over-year growth rate of GDP of 0.20 p.p. when compared to the previous quarter, up to a rate of 2.91%. This growth was mainly driven by the increase of machinery and equipment as well as by the external sector.
  • Furthermore, the year-over-year growth rate of the domestic demand experienced a decrease of 0.75 p.p. with respect to the third quarter, registering a growth rate of 1.99% due to the deceleration of public consumption.
  • As for the labor market, the unemployment rate went down to 3.57% and the year-over-year growth rate of employment decreased to 1.47% when compared to the third quarter.
  • The euro appreciated against the US dollar by 0.01 dollars per euro compared to the previous quarter, registering an exchange rate of 1.18 $/€. 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 1.66% in the fourth quarter of 2017, which is 0.07 p.p. below the rate registered in the previous quarter.

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