Germany: Economic stuttering but no slump ahead

At 1.5%, the German economy last year recorded its weakest GDP growth since 2013. Calendar-adjusted GDP growth also expanded by 1.5% following a whopping 2.5% in the previous year. 

Financial assets: Weakest growth in seven years

The financial assets of German households – despite significant losses in the last quarter – will remain above the 6 trillion mark in 2018, but only just: by the end of the year they should be around EUR 6,010 bn.

Germany: Economic cycle risk politics

The sentiment in the German economy continued to deteriorate in December. The ifo business climate index fell to its lowest level for more than two years. 

Euro Area: Downward trend continues

Sentiment indicators for the eurozone continued to decline in November. So far, slower economic momentum in the eurozone has been primarily attributed to the unfavorable development of industry. However, the service sector - the backbone of the current upswing - is far from enjoying immunity and increasingly coming under pressure.

Germany: Industry records weakest quarter in four years

Seasonally adjusted industrial production rose by only 0.2% in September compared with the previous month. On average in the third quarter, production was thus 0.9% below the level of the second quarter. It last recorded a similarly weak development in the second quarter of 2014.

Sentiment more or less stable

After the strong improvement in sentiment in August, the expected counter-movement in September was significantly lower than expected. Good news came from the manufacturing sector, where expectations were on a seven-month high. We expect solid economic growth in the second half of 2018, despite continuing high uncertainty.

Industry again with a poor start to the quarter

Seasonally adjusted industrial production fell by 1.1% in July compared with the previous month. It is now 0.9% below the average level of the second quarter. 

EMU: Fiscal policy tailwind not sufficiently exploited

Thanks to favorable macroeconomic conditions, the consolidation of public finances in the eurozone has made some progress. Nevertheless, the from an economic point of view sunny times were not used sufficiently to repair the roof: Government debt in the eurozone is still well above pre-crisis levels, while in some highly indebted euro countries the decline from the debt mountain has only just begun.

Labor market loses some momentum

The number of unemployed fell by 8,000 in August compared to the previous month on a seasonally adjusted basis. The basic trend thus remains clearly positive. However, the momentum has weakened somewhat recently.