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Macroeconomic outlook report: Germany

Third quarter of 2018

During the third quarter of 2018, Germany's GDP slowed by 0.79 p.p. in its year-over-year growth rate, to 1.16%. This was mainly due to the behavior of external demand, after a deceleration of net exports, despite the increase of domestic demand. In the labour market, the unemployment rate fell by 0.14 p.p. to 3.33%, while the year-over-year growth rate of employment slowed by 0.03 p.p. to 1.20%. Inflation was 2.10%, up 0.14 p.p. from 2Q18. Finally, the euro depreciated against the US dollar by 0.03 dollars per euro compared to the previous quarter, to an average exchange rate of 1.16 $/€ in the third quarter of the year.

Macroeconomic overview

  • During the third quarter of the year, the German economy recorded a slowdown in its year-over-year GDP growth rate of 0.79 p.p. with respect to the previous quarter, to 1.16%. This behavior was mainly due to the performance of external demand, after a deceleration in exports, in a higher proportion than the increase of domestic demand.
  • Domestic demand accelerated by 0.57 p.p. when compared to the previous quarter, to a year-over-year growth rate of 2.31%.
  • In the labour market, the unemployment rate fell by 0.14 p.p. to 3.33% and the year-over-year growth rate of employment slowed by 0.03 p.p. compared to the second quarter of 2018, to 1.20%.
  • The euro depreciated against the US dollar by 0.03 dollars per euro from the second quarter of 2018, recording an average exchange rate of 1.16 $/€ in 3Q18.
  • Inflation stood at 2.10% in the third quarter of 2018, following an acceleration of 0.14 p.p. from the previous quarter. This was mainly due to increases in industrial goods and energy 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.