The German economy is likely to be broken into the Corona of a crisis as never before in the history of the Federal Republic of Germany – with the relaxation of the contact constraints, the Worst may be over, but for the time being, and thus in the summer of recovery begin. This is evident from the new economic forecast, presented by the German Council of economic experts for the assessment of overall economic development on Tuesday. The so-called Council of “economy” is considered the most important Advisory body in the country and with the appointment of Monika Schnitzer and Veronika Grimm recently fünfköpfig. Among the other members of the Lars field, Volker Wieland, and Achim Truger.
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Compared with the year 2019, the Economists estimate the decline in German economic output is now at 6.9 percent this year. This value is adjusted for seasonal and calendar of special effects such as holidays. In absolute Numbers, would reduce economic output therefore of more than 3.4 to less than 3.2 trillion Euro. At the same time, the unemployment rate is expected to increase in spite of government support measures, such as the short-time work money from 5.0 percent in the previous year to 6.1 percent this year.
The decline in employment is in absolute Numbers, to approximately 500,000 workers. And a quick return to pre-crisis levels of close the “economy”, even if the German economy is likely to grow in the second half of the year 2020 and to be expected in the coming year, even a growth rate of 4.9 percent. The unemployment rate should increase in the coming months and in the coming year, and 6.1 percent, respectively.
catch-up effects “less likely”
As the forecast of the expert Council at the beginning of the Corona-crisis at the end of March, is dominated by the uncertainty about the further development. “For the present forecast of the German Council of economic experts, the assumption is that it is increasingly successful, the new infections and to halt a resurgence of the pandemic flare up avoid re-tightening measures”, – stated in the introduction. Crucial for the further course is likely to be, how in sync the further development of the global runs, “so that the recovery in the various economies due to a lack of export demand is slowing”.
The “economy” make no secret of the fact that it is in this respect have been in the previous forecast significantly over-optimistic; at the time, had designed three scenarios for the development of the German economy, performance and even in the worst case, “only” a Minus of 5.4% expected for this year. A major reason for the poorer development abroad, with corresponding consequences for the German exporters. For the Euro area, Economists expect even a Minus of 8.5 percent, what is spent, especially on the particularly strong declines in France, Italy and Spain (minus 11.0 to minus 11.8 percent). Add to this that in the of the mitigation measures particularly affected the services sector larger catch-up effects “somewhat likely” to be.
Doubtabout the ability to pay
“real-time” indicators such as electricity consumption or the Truck traffic suggest that from the point of view of the Council that time is likely to be equal to the lifting of the containment measures, the low point in the Corona-crisis. The on Tuesday released the business climate survey conducted by the London-based Markit Institute, which is a sign in Germany and in the rest of the Euro area in a much better mood fits. Nevertheless, the “economy” is very cautious in its forecast, comment and pointing to the large bundle of risks for the recovery of the German economy. The risk of “persistent belong to behavioural changes, structural adjustments trigger” could, and to hinder growth in the long term threaten.
