Germany’s economy is on course for its first full year of contraction since the pandemic, new forecasts showed, though rebounding consumption should spur a recovery in 2024.
Output will drop by 0.6% in 2023, according to projections by five institutes that advise the government. That’s a gloomier outlook than those of both the International Monetary Fund and the European Commission. Next year will bring growth of 1.3%, helped by rising wages, lower energy prices and easing supply bottlenecks.
The institutes lowered their expectations for this year from an April forecast for 0.3% expansion. The downward revision was mainly due to industry and private consumption “recovering more slowly than we expected,” Oliver Holtemoeller, vice president at the Halle Institute for Economic Research, said Thursday in a statement.
Europe’s largest economy has failed to regain momentum after Russia’s invasion of Ukraine sent energy prices soaring, triggering a recession. Its woes have shone a light on deep-seated structural issues that threaten to weigh over the coming years — including a dwindling workforce, an over-reliance on China and the energy transition.
The struggles have rippled though politics, too, contributing to an erosion in the popularity of Chancellor Olaf Scholz’s ruling coalition that’s helped the far-right AfD to surge in opinions polls.
German output will shrink by 0.4% this quarter, but rise by 0.2% in the final three months of 2023 — escaping another recession, according to the institutes. While the weakness is starting to reach the labor market, they only a expect a moderate increase in unemployment this year, followed by a slight improvement in 2024.
One headwind that looks poised to ease is inflation. Analysts reckon data due later Thursday will show a steep slowdown and the institutes see this year’s 6.1% reading plunging to 2.6% in 2024 and 1.9% in 2025.
Bundesbank President Joachim Nagel is among officials cautioning against overly pessimistic assessments of Germany’s prospects, saying the country has the capacity to adapt to the changing conditions and will overcome its current malaise.
TORONTO – Strength in the base metal and technology sectors helped Canada’s main stock index gain almost 100 points on Friday, while U.S. stock markets also climbed higher.
The S&P/TSX composite index closed up 93.51 points at 23,568.65.
In New York, the Dow Jones industrial average was up 297.01 points at 41,393.78. The S&P 500 index was up 30.26 points at 5,626.02, while the Nasdaq composite was up 114.30 points at 17,683.98.
The Canadian dollar traded for 73.61 cents US compared with 73.58 cents US on Thursday.
The October crude oil contract was down 32 cents at US$68.65 per barrel and the October natural gas contract was down five cents at US$2.31 per mmBTU.
The December gold contract was up US$30.10 at US$2,610.70 an ounce and the December copper contract was up four cents US$4.24 a pound.
This report by The Canadian Press was first published Sept. 13, 2024.
OTTAWA – Statistics Canada says wholesale sales, excluding petroleum, petroleum products, and other hydrocarbons and excluding oilseed and grain, rose 0.4 per cent to $82.7 billion in July.
The increase came as sales in the miscellaneous subsector gained three per cent to reach $10.5 billion in July, helped by strength in the agriculture supplies industry group, which rose 9.2 per cent.
The food, beverage and tobacco subsector added 1.7 per cent to total $15 billion in July.
The personal and household goods subsector fell 2.5 per cent to $12.1 billion.
In volume terms, overall wholesale sales rose 0.5 per cent in July.
Statistics Canada started including oilseed and grain as well as the petroleum and petroleum products subsector as part of wholesale trade last year, but is excluding the data from monthly analysis until there is enough historical data.
This report by The Canadian Press was first published Sept. 13, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in the base metal and energy sectors, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 172.18 points at 23,383.35.
In New York, the Dow Jones industrial average was down 34.99 points at 40,826.72. The S&P 500 index was up 10.56 points at 5,564.69, while the Nasdaq composite was up 74.84 points at 17,470.37.
The Canadian dollar traded for 73.55 cents US compared with 73.59 cents US on Wednesday.
The October crude oil contract was up $2.00 at US$69.31 per barrel and the October natural gas contract was up five cents at US$2.32 per mmBTU.
The December gold contract was up US$40.00 at US$2,582.40 an ounce and the December copper contract was up six cents at US$4.20 a pound.
This report by The Canadian Press was first published Sept. 12, 2024.
