German Chancellor Olaf Scholz said that the problems in Germany, the largest economy of the European Union, are primarily related to weakening global demand and falling exports. In this respect reports Bloomberg.
In addition, high inflation and rising energy prices also put pressure on the German economy. Currently, the cost of gas and electricity in the country is two or three times higher than at the end of February last year, when Russia’s special operation in Ukraine began.
Scholz also noted that supply chain disruptions during the pandemic have compounded the challenges.
According to the forecast of German economists from the Cologne Institute for Economic Research (IW) at the end of this year expected There was a 2% decrease in Germany’s imports and a 1% decrease in exports.
Germany’s GDP in the second quarter of 2023 remained unchanged compared to the previous three months. In the first quarter of this year, Germany’s GDP fell by 0.1% compared to the fourth quarter of 2022, which recorded a decline of 0.4%. Mikhail Vasiliev, chief analyst of Sovcombank, in a conversation with socialbites.ca registeredThe German economy is already on the verge of stagflation. This is a combination of high inflation and weak economic growth or even recession. According to Vasiliev’s predictions, the euro zone economy will enter stagflation this year and this situation will prolong.
Previously “socialbites.ca” saidIt was stated that the European Central Bank increased interest rates to combat inflation.