Germany’s economy returns to growth in Q1 2024

Germany’s economy has returned to growth in the first quarter of 2024, data by the Federal Statistical Office showed.

The country’s GDP rose 0.2% quarter-on-quarter in Q1, which matched both a preliminary estimate and market consensus.

Growth was mostly attributed to a rebound in gross fixed capital formation (1.2% QoQ after a 2.1% drop in Q4 of 2023).

Another positive contribution to the GDP came from net external demand. Total exports grew 1.1% quarter-on-quarter, while total imports increased at a slower rate, 0.6%.

Conversely, private consumption and government spending shrank at quarterly rates of 0.4%.

In annual terms, however, the German economy contracted 0.2% in Q1, or at the same rate as in the preceding quarter, while entering a technical recession for the first time in more than three years.

The EUR/GBP currency pair settled 0.02% lower at 0.8515 on Friday. For the week, the minor currency pair retreated 0.40%, as it extended the loss from the prior week.