Connect to share and comment

Household spending saves Germany from recession

PlacardEnlarge
(Globalpost/GlobalPost)

An increase in spending by consumers and households offset sagging exports and falling investment in Germany in the first quarter, allowing Europe's biggest economy to narrowly avoid recession, official data showed Friday.

The federal statistics office Destatis calculated in final data that Germany's gross domestic product (GDP) grew by 0.1 percent in the period from January to March following a contraction of 0.7 percent in the preceding quarter.

The data confirm a preliminary estimate already published earlier this month.

A recession is technically defined as two consecutive quarters of economic contraction.

A breakdown of the data showed that out of the different GDP components only private consumer spending was positive, growing by 0.8 percent.

Public-sector spending slipped by 0.1 percent, investment tumbled 2.4 percent, imports were down 2.1 percent and exports contracted by 1.8 percent, the statisticians calculated.

As stated earlier this month, Destatis blamed the unexpectedly weak start to the year to the "extreme winter weather conditions."

spm/yad

http://www.globalpost.com/dispatch/news/afp/130524/household-spending-saves-germany-recession