German economy grows more than expected in Q3
German inflation slowed more than expected in October, the first month of a government fuel tax cut, adding to evidence that Europe's largest economy could prove more resilient than anticipated d...
Germany's economy expanded more than anticipated in the third quarter, according to preliminary data from the country's statistics office. Despite disruptions from the war in Iran, GDP grew by 0.2% compared to the previous quarter, slightly higher than the forecasted 0.1%. The resilience of the economy is attributed to increased government spending, which surged since Berlin approved a €500 billion infrastructure fund and exempted defense spending from debt brake rules.
Inflation eased to 2.8% year-on-year in October, down from 3.3% in September, driven by a 12.2% decline in energy prices, according to the preliminary data. Core inflation, which excludes food and energy prices, fell to 2.1% from 2.4%. While analysts broadly agree Germany is emerging from a prolonged slowdown, many caution that the recovery may not be self-sustaining due to weak private investment and a lack of sweeping reforms.
The European Central Bank has indicated it may raise interest rates in December, but the extent of the economic revival remains uncertain, with some economists suggesting it could be a temporary boost rather than a lasting trend.
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