Germany’s economy: is an industrial recession less contagious than before?
News from 2019-07-10 / KfW Research
In the face of a stubborn industrial recession, the rather minor dent generally forecast for Germany’s business cycle is historically remarkable. All of unified Germany’s previous recessions were closely linked to pronounced phases of weakness in manufacturing. But this time it can be argued that domestic demand is so strong that the economy is better equipped to handle a slump in international demand than in the past. The weak global economy would nonetheless hit the export industry, but further dampening effects would remain limited. Is such relative equanimity really justified?