German Economy Slows as Energy Prices, Shipping Disruptions Persist
In its October economic assessment, the ministry indicated that growth likely weakened after the recovery recorded in the first half of the year. The slowdown came as global stockpiling of energy-intensive products declined and low water levels hampered inland shipping.
Domestic demand is also expected to offer limited support in the coming months, as rising energy prices reduce consumers’ purchasing power, economic uncertainty continues and borrowing costs increase.
Price-adjusted production across goods-producing industries rose 2% in August compared with July, after accounting for calendar and seasonal variations. Construction output climbed 9.3%, partly due to the completion of a major energy infrastructure project, while industrial production recorded a more modest increase of 0.6%.
Despite these monthly gains, industrial output in July and August averaged 1.4% below its second-quarter level. Energy-intensive industries remained particularly weak.
Manufacturing orders declined 10.6% month on month in August, mainly because of fluctuations in large contracts, including defense-related purchases. When major orders were excluded, the decrease was limited to 0.1%.
Nominal exports of goods and services fell 2.7% in August, marking a second consecutive monthly contraction. Nevertheless, exports remained 6.9% higher than in the same month a year earlier.
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