German government advisers cut growth forecast for 2019

Combined Shape

BERLIN (AP) — The German government’s panel of economic advisers nearly halved its German growth forecast for this year to 0.8 percent — the latest in a long list of downgrades for Europe’s biggest economy.

In a regular update Tuesday, the panel cut its 2019 forecast from the previous 1.5 percent but said growth should accelerate next year to 1.7 percent. The downgrade follows cuts in the German outlook by the European Commission and the International Monetary Fund.

The independent experts said in a statement that the lower forecast was strongly influenced by the after-effects of the economy’s weak performance at the end of last year, when it was dragged down largely by one-time factors related to new car emissions standards. German carmakers faced bottlenecks getting vehicles certified under new, more realistic emissions tests that came into force Sept. 1.

They also noted high risks for the future from factors such as Brexit uncertainty and global trade disputes.

Christoph Schmidt, the group’s chairman, said that “the peak of the German recovery is over. A recession however is not expected in view of robust domestic demand.”

Trending:
Trump Launches New Website to Replace Deleted Social Accounts, Mobilizes Fans to Retake Twitter

The German slowdown complicates the Europe’s economic picture. While falling unemployment and rising wages are supporting consumer spending at home, the economy faces external headwinds from slowing trade and worries that U.S.-China trade talks will fail and lead to higher tariffs and further increasing the drag from trade.

The European Central Bank took added steps to support the recovery at its last meeting March 7, pushing back the earliest date for an interest rate increase and announcing a new round of cheap loans for banks to enable them to lend to businesses.

The bank had ended a 2.6 trillion-euro ($2.9 billion) bond purchase stimulus in December after almost four years. But the worsening outlook pushed the bank to shift course toward maintaining existing stimulus rather than withdrawing it.

The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.

Truth and Accuracy

Submit a Correction →






We are committed to truth and accuracy in all of our journalism. Read our editorial standards.

Tags:
The Associated Press is an independent, not-for-profit news cooperative headquartered in New York City. Their teams in over 100 countries tell the world’s stories, from breaking news to investigative reporting. They provide content and services to help engage audiences worldwide, working with companies of all types, from broadcasters to brands.
The Associated Press was the first private sector organization in the U.S. to operate on a national scale. Over the past 170 years, they have been first to inform the world of many of history's most important moments, from the assassination of Abraham Lincoln and the bombing of Pearl Harbor to the fall of the Shah of Iran and the death of Pope John Paul.

Today, they operate in 263 locations in more than 100 countries relaying breaking news, covering war and conflict and producing enterprise reports that tell the world's stories.
Location
New York City




Conversation