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BERLIN — The German economy grew in the second quarter, propped up by household and government spending and beating analyst expectations that saw it on the edge of a downturn, data showed on Thursday.
Europe’s largest economy grew by 0.1% quarter on quarter and 1.7% on the year, adjusted for price and calendar effects, the federal statistics office said.
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Analysts polled by Reuters had expected the economy to stagnate quarter on quarter in the three months to June, in line with the statistics office’s earlier flash estimate.
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Household expenditures were up by 0.8% compared with the first quarter, despite high inflation rates and an energy crisis, said the office. Government consumption grew by 2.3%.
Analysts said the concerns about the economy remained acute.
“The negative factors are currently so great that even a sharper downturn cannot be ruled out,” VP Bank chief economist Thomas Gitzel said. “Or to put another way: A lot of positive things would have to happen for a recession not to materialize.”
The S&P Global flash composite Purchasing Managers’ Index (PMI) showed similar sentiment, with the reading indicating contraction for the second month in a row, while analyst forecasts for the Ifo business climate survey for August, due later on Thursday, point to another drop.
(Reporting by Miranda Murray; editing by John Stonestreet)
