There is no end in sight to Germany’s economic downturn, but a recession is not imminent, the country’s central bank said in its latest monthly report released on Thursday.
“The German economy continues to face difficult conditions,” the Bundesbank report stated.
Experts pointed to “increased economic uncertainty,” which is curbing corporate investment. “However, a recession in the sense of a significant, broad-based and prolonged decline in economic output is not currently expected,” the report stated.
Higher financing costs are slowing down the construction sector, while private consumption has not improved despite higher wages, the central bank wrote.
On top of that, the labour market is beginning to deteriorate, although the number of people employed in Germany remains high.
The Bundesbank predicted that Germany would post a flat growth rate for the third quarter.
