German economy under a dark cloud from its April staggering hit

June 19, 2020 – As America’s largest European trading partner, the German economy is expected to shrink by nearly 10% in the second quarter as the coronavirus paralyses the country, leading research institutes warned in April as reported by the Courthouse News Service.

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“The corona pandemic is triggering a serious recession in Germany,” the six think tanks, including the Institute for Economic Research, DIW Berlin, and RWI Essen, said in their annual spring report.

Gross domestic product likely contracted by 1.9% in the first three months of 2020 and is set to shrink by a whopping 9.8% year-on-year in the second quarter as companies feel the pain from widespread shutdowns.

The second-quarter plunge is twice as big as seen during the 2008-2009 financial crisis and is the steepest fall since the institutes’ records began in 1970, the report said.

Over the full year, Germany’s economy is predicted to contract by as much as 6%.

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