The German economy is set to return to growth in the remaining half of 2020 after the COVID-19 crisis dragged Europe’s biggest economy into recession, the ifo research institute said on Wednesday.
The Munich-based researchers said Germany’s economic output shrank by 2.2 per cent in the first quarter and a hefty 11.9 per cent in the second.
Meanwhile, it forecasts growth of 6.9 per cent and 3.8 per cent in the third and fourth quarters, respectively.
“Things will gradually start to pick up again now,’’ Timo Wollmershaeuser, head of forecasts at ifo, said.
The outlook, however, came with a warning based on assumptions about the further course of the epidemic and the political responses to it, adding that it came with a high degree of uncertainty.
According to the ifo forecasts, the German economy will decline by 6.7 per cent this year, before returning to growth of 6.4 per cent by 2021, putting economic output back on a par with levels seen at the end of 2019.