Germany – Scenario 2019-2020: moving towards a normalised growth rate
In Germany, GDP growth slowed markedly in 2018 (+1.5% annual average, after +2.5% last year). Activity should conserve a moderate growth rate of +1.3% in 2019 and the following year. German growth will continue to be driven by robust domestic demand, fuelled by both private consumption and investment. External demand will nevertheless continue to weigh on growth but to a lesser extent.
- Overview - Focus: manufacturing slows - Focus: a new chair of the CDU - Latest economic developments - Backbone of our scenario
Germany's industrial production fell by 0.9% q/q in Q3 2018 – the first fall in two years. The fall derives mainly from the decline in car production, down by 7% over the quarter and by 6% over 12 months. This can be explained by the difficulties experienced on assembly lines in adapting to the new European WLTP standards for checking CO2 emissions. Carmakers have had to stockpile unsold vehicles built to the older standards, while a bottleneck has formed for those that meet the new standards and which are earmarked for export. Sectors manufacturing intermediate goods that form part of the production process, such as rubber, have also been impacted, although to a lesser extent. Some sectors, such as pharmaceuticals, continue to see further very sustained growth.