Germany’s gross domestic product (GDP) contracted 0.2 percent for the quarter in the final three months of 2022, following an upwardly revised 0.5 percent expansion in the previous period. The market expectations of 0.0% q/q. The contraction in Europe’s largest economy was mainly led by a decline in household consumption, amid rising interest rates and stubbornly high inflation. By comparison the US economy increased at an annual rate of 2.9% in the fourth quarter, ahead of consensus 2.6%.
On a yearly basis, the economic growth slowed to 1.1 percent in the fourth quarter, the weakest since a 2.1 percent contraction recorded in the first quarter of 2021.
Germany Q4 preliminary GDP
- GDP -0.2% vs 0.0% q/q expected Prior +0.4%
- GDP (non-seasonally adjusted) +0.5% vs +0.8% y/y expected Prior +1.2%
- GDP (working day adjusted) +1.1% vs +1.3% y/y expected Prior +1.3%
Germany was affected by the Russian gas supply cut; however, it could have been much worse. The milder weather enabled Germany to boost winter reserves. Europe was able to build a working buffer for this winter and sending natural gas and power prices lower. Dutch TTF front-month natural gas futures collapsed over 70% from the highs.
Europe got through the cold season without needing to close parts of its industry by large-scale rationing of gas. Gas consumption was lower than forecast.
From The TradersCommunity News Desk